Fossil fuel gas1

1. 5th Aug 2015
A. M. Dharam
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2.  Domestic Natural Gas – APM ( Administered Price Mechanisum)
 Imported Gas RLNG ( Regasified –LNG)
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Domestic Gas
•Quantity – as Per Availability at Gas
fields
•Price – Declared by Govt of India (
Price based on four indices)
•Henry Hub ( US & Mexico)
•Alberta Gas ( Canada)
•NBP ( UK)
•Russia
RLNG
•Quantity – Available on Take or Pay
•Price – Linked to crude with a floor to
price.

3. Source National Vision 2030 2

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7.  Central Sector – 1967 MW
 State Sector – 2665 MW
 Total Public Sector – 4632 MW
 Private Sector – 9673 MW
 Total Stranded Assets – 14305 MW
 Gas based Power Plants with Average PLF 32 % - 9844 MW
 6

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PowerratesinRs/Kwh
Time of the Day in Hrs
Power Rate in Exchange
05-07-2015
06-07-2015
07-07-2015
04-08-2015
Imported Coal based generation Cost at current Coal Market beats the
APM gas based generation cost.
 8

10. Domestic Gas Supply side
constraints leading to
stranded assets.
With the Current down slide
of International coal prices
and drop in Power rate in
India, Sale of power from Gas
based generation is difficult
 9

11. Coal
61%
Gas
9%
Diesel
0%
Nuclear
2%
Hydro
15%
Renewal Energy
Sources
13%
Coal
Gas
Diesel
Nuclear
Hydro
Renewal Energy Sources
•Gas based generation has Low Emission hence environment friendly.
•Balance Fuel portfolio for India.
•Lower startup time , Lower time in commissioning.
•Once Established the Logistics is comparatively easy
 10

12.  Govt of India have come up with a scheme to subsidies RLNG by
• Waiver of VAT , CST, Octroi and entry Tax.
• Utilities need to bid out for subsidy.
• The Power generated will be sold to Distribution utilities.
• This will reduce the RLNG cost to 9- 10 USD/ MMBTU, as against
the mid term contract price of 15 USD/ MMBTU.
• In the current Market even selling Power from Such Gas is difficult.
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13.  Just like RPO for renewable : Gas base low pollutant power should be obligated to each
utility.
◦ Thus Gas based generation will survive, as it will be out of MOD
◦ Gas based Power will be blended with coal
◦ Thus 22000 MW power can be blended with 1,50,000 MW coal based generation.
◦ Power Generated from this gas based generation can be purchased by central govt and
can be redistributed to Discom based on demand.
◦ Regulators may monitor the Gas based generation fuel mix.
◦
 12

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