8 NATIONAL THERMAL POWER CORPORATION LIMITED (NTPC) MINISTRY OF POWER COMMITTEE ON PUBLIC UNDERTAKINGS (2020-21) EIGHTH REPORT SEVENTEENTH LOK SABHA LOK SABHA SECRETARIAT NEW DELHI EIGHTH REPORT COMMITTEE ON PUBLIC UNDERTAKINGS (2020-21) (SEVENTEENTH LOK SABHA) NATIONAL THERMAL POWER CORPORATION LIMITED (NTPC) MINISTRY OF POWER Presented to Lok Sabha on 24.03.2021 Laid in Rajya Sabha on 24.03.2021. LOK SABHA SECRETARIAT NEW DELHI March, 2021/Chaitra, 1942 (Saka) ii C O N T E N T S Page No. Composition of the Committee (2020-21) (vi) Introduction (vii) PART – I CHAPTER - I PROFILE OF THE COMPANY 1 1. Brief History 1 2. Pioneering Role in Power Sector 2 3. Contribution to Exchequer 2 4. Creation of Employment (Direct & Indirect) 2 5. Developing the Communities around the Plants 3 6. Objectives of NTPC 4 7. Composition of Board of Directors 4 8. Independent Directors - Need for Domain Expertise 5 9. Absence of Required Number of Independent Directors 6 10. Representation of Women in Board of Directors 8 11. MoU with Ministry of Power 9 CHAPTER-II PHYSICAL PERFORMANCE 11 1. Details of Plants of NTPC 11 2. Growth in Installed Power Generation Capacity 12 3. Capacity Addition (Installed & Commercial) 13 4. Coal-based Power Generation 14 5. Gas-based Power Generation 14 6. Renewable (solar,wind,bio-mass) Based Power Generation 15 7. Domestic Content Requirements in RE Projects 19 8. Joint Ventures with ONGC for RE Projects 20 9. Hydro-Power Generation 20 10. Comparison of NTPC with International Counterparts in Performace Metrics 22 CHAPTER –III FINANCIAL PERFORMANCE 24 1. Revenue from Operations 24 2. Revenues from Renewable Power 26 3. Profits and Profitability 26 4. CERC Guidelines-Impact on Profitability 28 5. CERC Tariff Regulations 28 6. Increase in Generation Capacity & Revenue 30 7. Financial Ratios 30 8. Return on Capital Employed (RoCE) 31 9. Interest Service Coverage Ratio (ISCR) 31 10. Cost Over-run in Under-Construction and Delayed Projects 32 11. Average Tariff of Electricity 34 12. Payment-Guarantee Mechanism 34 iii 13. Payment-Guarantee Mechanism for Group Companies 34 14. Defaulting DISCOMS 35 15. Performance of NTPC JVs and Subsidiaries of NTPC 36 16. Investments in Subsidiaries and JVs 38 17. Turning Around of Sick Plants 39 18. Financial Performance of Captive Coal Mines 40 19. Hydro-Power Generation-Cost 40 CHAPTER-IV OPERATIONAL MATTERS 42 1. New Plants under construction 42 2. Life of Thermal Power Plants (TPPs) 43 3. Renovation and Modernization of TPPs 46 4. Fuel Security of TPPs 51 5. Development of NTPC Coal Blocks 53 6. Incorporation of NTPC Mining Ltd. (NML) 54 7. Captive Coal Production 55 8. Import of Coal 57 9. Plant Load Factor (PLF) & Plant Availability Factor (PAF) of TPPs 59 10. Declining Trend in PLF due to demand/schedule 60 11. Future Strategy of NTPC 61 CHAPTER –V HUMAN RESOURCE MANAGEMENT 64 1. Manpower Strength 64 2. Performance Metrics 64 3. Value Addition Per Employee 65 4. Representation of Women in the Workforce 65 5. Awards and Accolades 67 6. Vigilance Matters 69 7. Strengths, Weaknesses, Threats and Opportunities (SWOT) Analysis 71 CHAPTER- VI OCCUPATIONAL HEALTH & SAFETY ISSUES 73 1. Safety Accreditation of Plants 73 2. Safety Audits 73 3. Incidents and Accidents 74 4. Occupational Health Certifications 75 CHAPTER-VII SUSTAINABILITY & ENVIRONMENTAL MATTERS 77 1. Flyash 77 2. Data on Ash Production and Utilization 79 3. Flu Gas Desulphurization 82 4. Environmental Pollution Control Measures 83 5. Water Consumption 85 6. Reduction in Water Comsumption 7. Use of Treated Sewage Water from Municipal Sewage Treatment Plants (STPs) 89 8. Zero Liquid Discharge(ZLD) from TPPs 89 9. Waste to Energy (WtE) Initiatives 90 10.10 Initiatives to Convert Municipal Solid Waster to Energy 11. Charging Infrastructure 91 12. Use of Bio-fuels 92 iv CHAPTER-VIII Research and Development 93 1. Expenditure on R&D 93 2. Granted Patents 93 3. Copyright Granted 94 4. IT & Digitization 95 CHAPTER-IX CORPORTE SOCIAL RESPONISIBILITY 96 1. CSR Activities 96 2. CSR Expenditure Details 99 3. Focus Areas of NTPC's CSR Activities 99 4. NTPC's CSR Activities in other Areas 103 5. The Outcome of CSR Interventions 105 CHAPTER-X C&AG AUDIT PARA 107 PART –II OBSERVATIONS/RECOMMENDATIONS OF THE COMMITTEE 110-135 APPENDICES (i) Minutes of the Sitting of the Committee held on 27 August 2020…… 136 (ii) Minutes of the Sitting of the Committee held on 7 January 2021……. 138 (iii) Minutes of the Sitting of the Committee held on 25 February 2021…. 141 (iv) Minutes of the Sitting of the Committee held on 25 February 2021…. 143 (v) Minutes of the Sitting of the Committee held on 23 March 2021……. 146 v COMPOSITION OF COMMITTEE ON PUBLIC UNDERTAKINGS (2020-21) Smt. Meenakashi Lekhi - Chairperson Members LOK SABHA 2. Dr.Heena Vijaykumar Gavit 3. Shri Chandra Prakash Joshi 4. Smt. K. Kanimozhi 5. Shri Raghu Ramakrishna Raju Kanumuru 6. Smt. Poonamben Hematbhai Maadam 7. Shri Arjunlal Meena 8. Shri Janardan Mishra 9. Shri Kinjarapu Ram Mohan Naidu 10. Prof. Saugata Roy 11. Dr. Arvind Kumar Sharma 12. Shri Ravneet Singh 13. Shri Sushil Kumar Singh 14. Shri Uday Pratap Singh 15. Shri Ramdas Chandrabhanji Tadas RAJYA SABHA 16. Shri Prasanna Acharya 17. Shri Birendra Prasad Baishya 18. Shri Anil Desai 19. Shri Joginipally Santosh Kumar 20. Shri Om Prakash Mathur 21. Shri Surendra Singh Nagar 22. Shri M. Shanmugam Secretariat Shri R.C. Tiwari - Joint Secretary Shri Srinivasulu Gunda - Director vi INTRODUCTION I, the Chairperson, Committee on Public Undertakings (2020-21) having been authorized by the Committee to submit the Report on their behalf, present this Eighth Report on ‗National Thermal Power Corporation Limited (NTPC)'. 2. The Committee on Public Undertakings (2020-21) selected the above said subject for detailed examination. 3. The Committee on Public Undertakings (2020-21) were initially briefed about the subject by the representatives of the National Thermal Power Corporation Limited (NTPC) on 27th August, 2020. The Committee then took evidence of the representatives of National Thermal Power Corporation Limited (NTPC) on 7th January, 2021 and further evidence on 25th February, 2021. The Committee also took evidence of the representatives of Ministry of Power on the subject on 25 February, 2021. 4. The Committee (2020-21) considered and adopted the draft Report at their sitting held on 23 March, 2021. 5. The Committee wish to express their thanks to the representatives of National Thermal Power Corporation Limited (NTPC) and Ministry of Power for tendering evidence before them and furnishing the requisite information to them in connection with examination of the subject. 6. For facility of reference and convenience, the Observations and Recommendations of the Committee have been printed in bold letters in Part-II of the Report. New Delhi; MEENAKASHI LEKHI 23 March, 2021 Chairperson 02 Chaitra, 1942 (S) Committee on Public Undertakings vii CHAPTER-I PROFILE OF THE COMPANY Brief History 1.1 NTPC Limited, a Maharatna Company of the Government of India, is the largest power generator in India. It was incorporated in 1975 as a fully Government owned company. NTPC came out with an Initial Public Offer(IPO) in 2004 and a Follow-on Public Offer(FPO) in 2010. Government of India has reduced its stake through various tranches of Offers for Sale, employee offers for sale, Bharat 22 Exchange Traded Fund (ETF) and CPSE ETF from time to time. Currently, the Government of India, holds 51.02% stake in the company, the rest being held by Institutional Investors and public. The NTPC is listed in Bombay Stock Exchange (BSE) and National Stock Exchange (NSE). 1.2 Over the years, NTPC has attained a global stature. In the Platts Top 250 Global Energy Companies for 2019, NTPC has been ranked as No.2 ‗Independent Power Producer and Energy Traders‘ in the world. Further, NTPC has been ranked 497th largest company in the world among ‗Global 2000‘ list of companies compiled by Forbes for 2020. 1.3 Commissioned capacity of NTPC (including JVs and subsidiaries) is 62,910 MW comprising 51,155 MW directly owned by NTPC (45,410 MW coal based stations at 24 locations, 4,017 MW gas/liquid fuel based stations at 07 locations, 800 MW hydro project at 01 location, 870 MW Solar PV plants at 11 locations, 50 MW wind project at 01 location and 8 MW small hydro at 01 location). The total capacity includes 11,755 W under joint ventures/subsidiaries comprising 6,494 MW from 09 coal based, 2,494 MW from gas power plant at 4 locations, 5 MW Solar PV plants at 1 location, 2,625 MW from hydro power plants at 8 locations, 24 MW of small hydro at 1 location and 113 MW wind at 2 locations. Capacity of 20,533 MW (including 1320 MW in Bangladesh) is under construction at 35 locations. Pioneering role in Power Sector 1.4 With regard to the role of NTPC in developing the power sector in India, the Committee was informed as under : ―(i) Power generation NTPC is the largest power generating company in the country with nearly 21% share of total generation. It supplies power to almost all the states in the country and sells power to state utilities, who in turn sell to actual consumers.NTPC's contribution tothe development of the power sector comes through this unique position as a bulk power supplier with very high availability.NTPC‘s focus has been to provide reliable and affordable power to the states in an environment-friendly and sustainable manner. (ii) Capacity building in the power sector NTPC contributes to capacity building in the power sector inthe following ways: Consultancy NTPC‘s Consultancy Wing is providing Project Management Consultancy to several State and central power plants.