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New Delhi:
Reliance Industries’ (RIL) planned entry into power business will provide a big boost to the industry which is struggling to add generation capacity at a rate that matches the Indian economy’s fast-growing demand for electricity.
“We are drawing up specific plans for mega investments in this sector with clean coal-based power generation projects, hydel projects and also in nuclear power as and when it is opened,” Mukesh Ambani told RIL’s shareholders in the company’s annual general meeting in Mumbai on Friday. Although the Centre has set a target to add 78,000mw during the 11th Plan Period, only 22,000mw has been added so far. The target for the 12th Plan is 100 gw.
RIL chairman’s emphasis on ‘clean coal’ speaks a lot about the company's strategy. It plans to use washed coal instead of raw coal in its power projects.
If a power project is located at a distance more than 700-800 km from a coal pithead, using washed would make a better economic sense than raw coal which might have ash content as high as 40%.
The company's intention to use washed coal reveals its strategy to set up power projects near load centre or in coastal areas rather than at pit heads. Significantly, the Union power ministry has also envisaged some ultra mega power projects based on imported coal.
Using washed coal also reduces carbon footprint of a power plant. Given the urgency to fight climate change, pressure is mounting globally to slap carbon tax on coal-fired power plants. That is the reason why big thermal generators like NTPC are diversifying into renewable and nuclear power generation. RIL also seems to think that it would not be a great idea to take a long-term bet on raw coal based power generation.
Significantly, research works are being undertaken in the US on how coal can be burnt for power generation with zero emission. The US has also agreed to share benefits of the research programme with India.
But what holds a much better promise of growth for RIL in the long term is India's plan to become a global player in solar power. The government has planned to add 20,000 mw grid-based solar power generation capacity by 2022 under the Jawaharlal Nehru National Solar Mission (JNNSM). The bulk of the capacity will be based on solar thermal equipment.
While India is a big player in photovoltaic solar power equipment, it will need...
