NTPC wins local thermal power project bid

The National Thermal Power Corporation (NTPC), which has bid successfully for setting up a 300-mw power plant in Sri Lanka, has initiated negotiations with the Government on the project.

"We have emerged as the successful bidder in the limited competitive bidding process.

Details of the project are being worked out. We are now working on the issue of fuel - the most important input for running a power plant," senior NTPC officials said.

The officials feel the project can help Sri Lanka put its ailing power sector back on its feet. Sri Lanka desperately needs to increase its generating capacity and bring down the cost of production, without inviting opposition from the powerful environment lobby.

"The proposed NTPC project at Norochcholai in Puttalam district, north of Colombo, could be the forerunner of coal-based power plants which would help bring down the cost of production and reduce power tariffs in a country where rates are the highest in the region," the officials added.

Sri Lanka has been predominantly using oil to fuel its power plants because of environmental considerations. Sixty five per cent of the power is generated by oil-run plants. However, oil is an expensive commodity and its price fluctuates in a wide range.

That, to a large extent, explains why oil is used to generate only 7 per cent of the power globally. The issues being discussed are the choice between low sulphur coal and liquefied natural gas (LNG) for the fuel; the price of power; the feasibility of the project and its environmental impact.

Feasibility and environmental studies had been conducted earlier, and these reports are currently with NTPC for its consideration. Apparently, the environmental issue is not a major one now.

The Telegraph