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Investors increasingly unwilling to fund stressed thermal power assets

March 28, 2021

The Hindu Business Line:

India’s 40 gigawatts (GW) of stressed thermal power assets, identified by a special parliamentary committee in March 2018, still linger on — most of them without any feasible resolution.

Many of the fundamental problems still persist despite efforts to resolve them by the government, lending institutions and proponents of the projects. These include lack of appropriate coal linkages, lack of power purchase agreements (PPAs) and capital cost overruns due to delays in acquiring land, accumulated interest funding costs and getting environmental clearances. 

IEEFA has looked at some of the non-performing assets for which either a resolution has yet to be agreed, or one has been agreed but not yet executed. These are projects that are fully commissioned or near completion with adequate PPAs and coal linkages. Some of them are pithead plants with levelised tariffs of below ₹4/kWh. 

[Kashish Shah]

More: Time to retire stranded thermal power units

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