State of Kerala wants duty free naphtha for its plant

Kerala Chief Minister, Oommen Chandy, seeks concessional naphtha to power its 360 MW NTPC's plant at
Kayamkulam.

He based it on severe shortage.

The minister highlighted the fact that Kerala could not harness its hydro electric potential due to environmental and biodiversity concerns in the Western Ghats and the thermal power plant was established in Kayamkulam to make up for the loss.

But following a steep hike in the price of naphtha, the per unit power cost at Kayamkulam has escalated to Rs 10.50 per day. As a result, the Kerala State Electricity Board has been forced to under-schedule power from this plant. The state is now shelling out Rs 20 crore in fixed charges per month on the plant.

According to him, there is an urgent need for the government to exempt the excise duty on naphtha used for electricity generation at Kayamkulam. In addition, efforts should be made to provide naphtha at controlled prices for the electricity generation, at par with those of naphtha allocated for the agriculture sector.