Tata Power Company has decommissioned â€˜Unit 6â€™ of 500 megawatts at its Trombay thermal power plant in Mumbai, citing the high cost of generation and its inability to get a power purchase agreement after the earlier one expired in March 2018.
The Trombay unit has an installed generation capacity of 1,580 MW, which supplies electricity to the majority of consumers - both bulk and retail - in Mumbai.
â€œWe have informed the Central Electricity Authority (CEA) regarding retirement & decommissioning of Unit 6. CEA has approved the same and sent us a letter in this regard,â€ Tata Power said.The company, till the time of going to press, did not comment on ETâ€™s queries on whether the company would look at setting up another unit to replace this unit.
The decision to retire Unit-6 (500 MW) of Trombay thermal power station has been taken by Tata Power Company, based on its own techno-economic reasons, and based on its decision, the capacity of this unit is being deleted from the database of All India Installed Capacity, CEA said.
â€œIt is seen that the decision to decommission Unit-6 of Trombay TPS has been taken by Tata Power Company due to the high cost of generation and capacity tie-up could not be achieved after expiry of PPA on March 31. The approval for decommissioning of Unit-6 (500 MW) at Trombay TPS has been accorded by the competent authority on 30.07.2019,â€ CEA said.
In a report earlier this month, Citi Research said that it expects Tata Powerâ€™s consolidated EPS to grow at a compounded annual growth rate of 44% over FY19-22 and consolidated return on equity to increase to 8.8% in FY 22 from 3.6% in FY19. The brokerage has a â€˜buyâ€™ rating on the company with a price target of Rs 76 a share. Shares of Tata Power closed at Rs 67 on the Bombay Stock Exchange on Friday, up 3.6% from its previous close.
Tata Power has an installed capacity of 10,957 MW, with renewable energy assets in solar and wind accounting for 30% of the company's portfolio.
Referred from economic times