The central government is considering the creation of a special purpose vehicle (SPV) by NTPC, Power Finance Corporation (PFC) and Rural Electrification Corporation (REC). This SPV will operate stressed assets in the thermal power space.
The central government is considering the creation of a special purpose vehicle (SPV) by NTPC, Power Finance Corporation (PFC) and Rural Electrification Corporation (REC). This SPV will operate stressed assets in the thermal power space.
In an interview to CNBC-TV18, Ashok Khurana, Director General of Association of Power Producers and Harshvardhan Dole, VP-Institutional Equities at IIFL discussed the implications.
Khurana said that majority of the thermal power plants are suffering because of factors beyond their control like no offtake agreement, there is no coal supply etc.
He further said that an SPV won't solve power plants' operational problems. These plants are not suffering because of want of good operations, in fact their operational parameters are by far the best.
According to him, power plants are not suffering by the factors which are controlled by the government.
Government has to tackle the factors leading to power stress, said Khurana.
Dole of IIFL said that power sector will get a lease of life if State Electricity Boards (SEBs) are capitalised.
He further said that SEBs have taken some proactive measures, but most issues still persist.
Watch accompanying video for more details.