SIMA to set up its own captive power plan
In order to overcome the frequent power trippings at the spinning mills, the Southern India Mills Association (SIMA) has a proposal to set up its own captive power plant at Tuticorin.
'A special purpose vehicle (SPV) would be formed for this group power plant in which 51 per cent equity would be owned by our members and the balance made up by financial institutions. Acquiring a term loan is also a possibility,' said S V Arumugam, chairman, SIMA.
Talking to media yesterday, he said once the government okayed the proposal for the thermal plant, land was expected to be allotted to them for going ahead with the project.
Making a forceful plea to restrain the lower-level officials of the Tamilnadu Electricity Board from making erratic and non-uniform trippings at the spinning mills that affected the product quality and the high-tech machinery of latest technology, Arumugam said that in spite of taking up this serious issue with the TNEB chairman many times there was no concrete response from them so far. He said the TNEB was not adopting a uniform and transparent policy in managing the trippings and power shut downs which were not distributed evenly across circles.
A single minute of power cut resulted in loss of production for 20 minutes as the automated mills have to reboot from the beginning after every tripping. Next to raw materials, power consumption was the major input, adding nearly 14 per cent of the turnover at the spinning mills. Also, the high cost of power tariff in Tamilnadu, Rs 4.20 per Kwh, had impeded the growth of textile units in this State, opined Manikam Ramaswami, chairman, Loyal Textile Mills Ltd and past chairman, SIMA.
In the last year alone, SIMA members reported a loss of Rs 800 crore due to unscheduled trippings (from Jan to Dec) and the possibility of more power cuts was more this year, he feared. Nearly 650 MW of power was consumed by SIMA members out of 1,200 MW being absorbed by all mills in South India on a day. Some of the mills in Madurai, Coimbatore and Tirunelveli were badly affected by trippings and have complained regularly to the top officials of their EB Circles to discipline their lower-level staff who had no accountability or a review system and functioned at their free will, explained SIMA officials.
However, the mills association had requested TNEB to allow its members to use their furnace oil-based generating sets which could be used to fill the power deficit. For mills to use these gen sets to full capacity, the government should waive 'notional income' it got from idle sets by doing away with sales tax, power tax and waiver of maximum demand (MD) charges to the extent of MD not availed, said office-bearers of SIMA.
The textile body asked the State government to extend the status of 'continuous processing' industry to spinning mills as most of them worked non-stop with three shifts per day.
For a permanent solution, SIMA officials had plans to meet the Chief Secretary and Industries Secretary to explain of their decision to set up a captive power plant in Tuticorin. 'It will be a 500 MW plant with an investment of Rs 2,200 crore for sole use of spinning mills as there is provision in the Central Electricity Regulation Act for setting up a group plant,' they said. If only the power trippings were managed in a transparent manner by the TNEB, SIMA officials said, more spinning mills would come up and the existing ones would go for major expansion in Tamilnadu which was culturally.
'A special purpose vehicle (SPV) would be formed for this group power plant in which 51 per cent equity would be owned by our members and the balance made up by financial institutions. Acquiring a term loan is also a possibility,' said S V Arumugam, chairman, SIMA.
Talking to media yesterday, he said once the government okayed the proposal for the thermal plant, land was expected to be allotted to them for going ahead with the project.
Making a forceful plea to restrain the lower-level officials of the Tamilnadu Electricity Board from making erratic and non-uniform trippings at the spinning mills that affected the product quality and the high-tech machinery of latest technology, Arumugam said that in spite of taking up this serious issue with the TNEB chairman many times there was no concrete response from them so far. He said the TNEB was not adopting a uniform and transparent policy in managing the trippings and power shut downs which were not distributed evenly across circles.
A single minute of power cut resulted in loss of production for 20 minutes as the automated mills have to reboot from the beginning after every tripping. Next to raw materials, power consumption was the major input, adding nearly 14 per cent of the turnover at the spinning mills. Also, the high cost of power tariff in Tamilnadu, Rs 4.20 per Kwh, had impeded the growth of textile units in this State, opined Manikam Ramaswami, chairman, Loyal Textile Mills Ltd and past chairman, SIMA.
In the last year alone, SIMA members reported a loss of Rs 800 crore due to unscheduled trippings (from Jan to Dec) and the possibility of more power cuts was more this year, he feared. Nearly 650 MW of power was consumed by SIMA members out of 1,200 MW being absorbed by all mills in South India on a day. Some of the mills in Madurai, Coimbatore and Tirunelveli were badly affected by trippings and have complained regularly to the top officials of their EB Circles to discipline their lower-level staff who had no accountability or a review system and functioned at their free will, explained SIMA officials.
However, the mills association had requested TNEB to allow its members to use their furnace oil-based generating sets which could be used to fill the power deficit. For mills to use these gen sets to full capacity, the government should waive 'notional income' it got from idle sets by doing away with sales tax, power tax and waiver of maximum demand (MD) charges to the extent of MD not availed, said office-bearers of SIMA.
The textile body asked the State government to extend the status of 'continuous processing' industry to spinning mills as most of them worked non-stop with three shifts per day.
For a permanent solution, SIMA officials had plans to meet the Chief Secretary and Industries Secretary to explain of their decision to set up a captive power plant in Tuticorin. 'It will be a 500 MW plant with an investment of Rs 2,200 crore for sole use of spinning mills as there is provision in the Central Electricity Regulation Act for setting up a group plant,' they said. If only the power trippings were managed in a transparent manner by the TNEB, SIMA officials said, more spinning mills would come up and the existing ones would go for major expansion in Tamilnadu which was culturally.
Source:newstodaynet
