OREANDA-NEWS. Essar Power Gujarat Ltd (EPGL), a subsidiary of Essar Power Ltd (EPL), and the owner and operator of a 1,200 MW imported coal-fired thermal power plant at Salaya in Gujarat’s Devbhumi Dwarka district, has recorded a 33% growth in EBITDA in the half year ending 30 September 2016 over the previous fiscal. The EBIDTA for the first of the current financial year stood at Rs. 300 crore compared with Rs. 226 crore in the same period last year. The revenues grew  by 12% to Rs 951 crore in H1 FY17 from Rs 851 crore in H1 FY16.

The strong financial performance can be attributed to robust improvement in all operational parameters, like plant availability, which grew by 14%, as well as generation, which also grew by 14% to 2,953 million units as against 2,595 million units in the corresponding period last year. Input costs, on the other hand, were lower. The coal cost, for instance, came down by 9% to Rs 1.95/kWh from Rs 2.13/kWh.

According to Mr Ramesh Kumar, Managing Director, EPGL: “While we registered a remarkable performance in the first quarter, our strong showing in the half year is a clear indication that we will close FY17 on a high. We have been working diligently on improving our operational parameters. Migration from a single-origin coal basket to a multi-origin one through inviting bids from global coal suppliers on our indigenously developed reverse e-auction platform has helped us better our margins. The upcoming sea water intake system and coal conveyor corridor will further enhance our margins once they are commissioned.”

EPGL’s Salaya plant meets 9% of Gujarat's overall power demand. It has an ongoing 25-year PPA with the country’s highest rated discom, the Gujarat Urja Vikas Nigam Limited (GUVNL; Rating A1+), for 90% of its capacity, ensuring timely payment of receivables. EPGL continues to ensure over 80% availability to its anchor customer, GUVNL. Among the many awards that EPGL has won in the current fiscal, the most significant is CII’s Excellent Energy Efficient Unit award that was conferred on the Salaya plant.

Proprietary reverse e-auction platform

A key differentiator for EPGL is Essar Power’s proprietary reverse e-auction platform to import coal. The platform, in operation for five months now, has 30 registered miners and traders participating from Indonesia, Australia, South Africa and Colombia. Once a month, Essar Power puts up information on the platform on the quantity and quality of coal required, which is followed by suppliers quoting their prices. The auction, conducted over three hours, pops up the lowest bid every 10 minutes so that participants can revise their prices as required. The company has already sourced Rs 1,500 crore worth of coal using the platform and will invest another Rs 3,000 crore in buying coal the next year.

Mr KVB Reddy, CEO, Essar Power Ltd, said: “We have done a lot to make all our units efficient and profitable and EPGL is the best example of these efforts. The fact that its half-yearly EBITDA growth is almost three times the revenue growth shows the significant cost and operational efficiencies that EPGL has been able to harness. With the government adopting several measures to revive the power sector, like increased domestic coal production and the launch of the UDAY scheme, we are hopeful about sustaining the strong financial and operational performance across our plants. ”