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Difficult to sustain operations in India, says company
New Delhi, Dec. 20:
Hong Kong-based CLP Holdings Ltd, one of the biggest private foreign investors in India’s power sector, has reached out to the Prime Minister saying fuel shortage had made it bleed financially and caused huge revenue losses.
Andrew Brandler, Chief Executive Officer of CLP Holdings, in a recent communication to Prime Minister Manmohan Singh said his Indian team had been “grappling with tactical issues arising out of insufficient infrastructure and lack of enabling policies from the Government”.
“In these circumstances, it is becoming increasingly difficult for us to sustain our operations in India, as our profitability dips to alarming levels and we bleed financially on a daily basis,” Brandler said in his letter to Singh, seen by Business Line.
He did not, however, give any details of the losses. An email sent to Brandler seeking details remained unanswered.
CLP, which has invested nearly Rs 12,000 crore in India, said despite the recent intervention from the Prime Minister’s Office and the Planning Commission, the agencies critical to the revival of the Indian power sector had not shown much intent to co-operate.
“CLP is committed to the Indian power sector for the long term. But until the issues affecting the thermal generation sector are resolved, it would be difficult for us to justify further investments in the thermal power sector in India,” Rajiv Mishra, Managing Director of CLP India, told Business Line.
The Hong Kong-based investor has particularly mentioned two projects – 1,320 MW domestic coal-fired plant in Jhajjar in Haryana and 655 MW gas-based power station in Gujarat.
CLP alleged that Coal India had not supplied coal exceeding 50 per cent for the Jhajjar station.
This has led to huge under-recovery of costs leading to non-payment of dues to banks and financial institutions.
The Gujarat unit is operating below 40 per cent capacity due to gas scarcity.
The Prime Minister’s Office has sought comments from the Coal Ministry on the issue. The Ministry is awaiting responses from Coal India. The replies are expected shortly, a Coal Ministry official said.
FOCUS ON RENEWABLES
After facing hiccups in the conventional energy space, CLP is looking to cash in on the renewable sector.
“In contrast to the position on conventional generation, however, the current performance and outlook for renewable energy investment in India is promising. CLP is already the largest investor, foreign or domestic, in wind energy in India,” said Mishra.
He said in light of the performance of these investments and on the basis of the continuation of the present supportive regulatory framework, CLP intends to focus its investment in India on renewable energy along with continued growth of its existing wind energy portfolio.
Mounting woes Lack of infrastructure, enabling policies hitting projects Two projects _ 1,320-MW coal-fired plant in Jhajjar, Haryana and 655 MW gas-based power station in Gujarat are worst hit PMO has sought Coal Ministry’s comments on the issue.
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