NTPC subsidiary incurs Rs 137.87cr loss due to failure to meet CERC norms

By IndianMandarins- 03 Aug 2022


New Delhi (03.08.2022): The CAG in a performance audit report has said that a wholly owned subsidiary of NTPC Ltd in Bihar, Kanti Bijlee Utpadan Nigam Limited (KBUNL) incurred a loss of Rs 137.87 crore between 2015-16 and 2019-20 due to its failure to achieve the norms fixed by the CERC (Central Electricity Regulatory Commission). KBUNL had been set up to revive the power plant of Bihar State Electricity Board and to set up new projects to cater to the power requirements of the nation. The Company, however, even after 15 years of its operation, was unable to operate at full capacity and its operations have continued to remain constrained.
The NTPC subsidiary failed to achieve the norms fixed by CERC for gross station heat rate, auxiliary power consumption, and specific fuel oil consumption due to non-scheduling of power for Stage I units and installation of oversized machinery in Stage II units. This resulted in a higher cost of generation and non-recovery of energy charge rate. The projects under Stage II units were delayed which resulted in time and cost overruns. The actual cost increased by 65 percent (Rs 2,063 crore) over the approved cost, said the CAG.

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