NTPC should focus on reviving stranded plants, not new projects

New Delhi Strategic acquisitions and subsequent revival of stranded thermal power plants by state-owned NTPC can help banks clear their balance sheets, IEEFA has said.

According to the Institute for Energy Economics and Financial Analysis (IEEFA), acquiring and reviving stranded thermal power plants is a better option for all stakeholders, including NTPC. The government has asked NTPC to add 7 gigawatts (GW) of thermal power capacity, as per the research firm's latest report.

"We find that the company (NTPC) can acquire 6.1 GW of stressed thermal assets through partnerships with Power Finance Corporation-REC and National Asset Reconstruction Company Limited with minimal investment...acquiring and subsequently reviving stranded thermal plants is a better option for all stakeholders," IEEFA said.

Strategic acquisitions and subsequent revival of stranded thermal power plants will clear up the last pile of stranded assets on banks' balance sheets and leave bank capital unlocked for investing in increasing renewable energy generation while meeting the country's short-term power demand, it said.