Mundra Adani Thermal Power Project

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The Mundra Thermal Power Project is a 4620-megawatt (MW) coal-fired power station in Gujarat state, India, conceived for the captive consumption of the Mundra Port by the Adani Group.

Location

The undated satellite photo below shows construction activity at the project site, which is located at Mundra taluk, Kutch district, in Gujarat state, India.

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Background

The total capacity of the plant is 4620 MW, consisting of 4 subcritical units of 330 MW each and 5 supercritical units of 660 MW each.[1] As planned, all units of the plant were fully operational within the 11th Five Year Plan (2007-2012).[2][3]

Proposed expansion

Adani Power had proposed expanding the plant by 3 x 1,000 MW. In May 2016, the expert advisory committee (EAC) of the union ministry of environment and forests (MoEF) declined the company's proposal on the grounds that it was situated very close to ecologically sensitive creek and estuary network, as well as a reserved forest, mangrove forest, three small rivers and at least nine villages with schools and hospitals in 'close proximity' to the proposed site. The EAC suggested Adani to find another location for expansion.[4]

Financial problems

Adani Power Mundra likely to seek bankruptcy protection

Adani says the company has been unable to service its power purchase agreement (PPA) for the plant amid rising costs for coal. In response, Adani Power tried to sell a 51 per cent stake in the plant to Gujarat Urja Vikas Nigam (GUVNL), a state-owned power utility that has power purchase agreements for 2000 MW from the plant. However, lenders for the Mundra plant withdrew from the sale. Without a sale to GUVNL, Adani Power Mundra said it is likely to seek bankruptcy protection. The plant ran at only 37 per cent plant load factor in the first quarter of 2018 and is unable to service its debts. Adani Mining claimed its proposed Carmichael coal mine in Australia was needed to supply the plant.[5]

In 2010, before construction of the project was complete, Adani argued that Gujarat should renegotiate the agreement and allow Adani to sell power at a higher price since the price of Indonesian coal, which it used as a raw material, had gone up. Yet in 2013 it was revealed that Adani Enterprises held 74% of shares in the Indonesian coal company through which the coal was being imported, meaning the company was profiting from the high coal prices.[6]

Bankruptcy avoided by passing costs to power users

In April 2017, the Supreme Court struck down Adani's request for a new power price argument. However, in December 2018 the Gujarat government passed an order allowing Adani to sell power at higher prices to Gujarat Urja Vikas Nigam, the state electricity distribution company, which in turn was allowed to raise the tariffs for consumers. Accordig to Scroll.in, the Gujarat government order effectively extricated the Mundra power project from potential insolvency proceedings.[6]

Project receives CDM certification

Unit 5 of Phase III of the Mundra project was the first plant in India to use supercritical technology, which provides greater efficiency through higher boiler pressures and temperatures. Phase III of the Mundra project received Clean Development Mechanism (CDM) certification under the the United Nations Framework Convention on Climate Change (UNFCC), making it the first supercritical project in the world to receive CDM certification.[7] The award of CDM certification makes the project eligible for subsidies financed by carbon offsets bought by British and European companies in lieu of cutting their own emissions.[8] Awarding CDM credits to coal plants has been widely criticized. According to a report by the Stockholm Environmental Institute, using CDM credits to encourage a more efficient power technology is only appropriate if the more efficient technology is not happening anyway. However, "the transition away from less efficient subcritical technology to supercritical technology in India ... is well under way, if not largely complete."[9]

Coal supply

Don't trust Adani with the Great Barrier Reef

As of 2011, 70% of the requirements at Mundra is met with imported coal.[10]

Adani has proposed the Carmichael Coal Project in Australia to export coal to plants in India. The project would include an open cut and underground coal mine and a 189 km rail link to transport the coal from the Galilee Basin to Abbot Point, near the Great Barrier Reef.[11]

Project Details

Sponsor: Adani Power Mundra
Parent company: Adani Group
Location: Tunda village, Mundra taluk, Kutch district, Gujarat
Coordinates: 22.8235448, 69.5574957 (exact)
Status: Operating
Phase I

  • Unit 1 - 330 MW - commissioned 2009[3]
  • Unit 2 - 330 MW - commissioned 2010[3]

Phase II

  • Unit 3 - 330 MW - commissioned 2010[3]
  • Unit 4 - 330 MW - commissioned 2010[3]

Phase III

  • Unit 5 - 660 MW - commissioned 2010[3]
  • Unit 6 - 660 MW - commissioned 2011[3]

Phase IV

  • Unit 7 - 660 MW - commissioned 2011[3]
  • Unit 8 - 660 MW - commissioned 2012[3]
  • Unit 9 - 660 MW - commissioned March 9, 2012[12]
  • Phase V (3 x 1,000 MW): Cancelled (proposal rejected by India MoEF)

Nameplate capacity: 4,620 MW
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