Plant load factor to double by FY25

Utilization levels of gas-based power plants are seen to double by FY25 from current levels, driven by the increased domestic gas production from the east coast fields and prices of liquefied natural gas (LNG) becoming competitive.

As per a recent report by HDFC Securities, plant load factor (PLF) for gas-based power plants is seen to rise from 18% in July this year to 36% by FY25, and “this should drive an incremental total demand of 13 million standard cubic meter per day (mscmd) between FY21-25(estimated)”.

Fertilizer and power sectors are the largest consumers of natural gas, consuming 51% of total gas available in the country. Among the 24,900 megawatt (mw) installed gas-based power stations in the country, most of them are sitting idle due to the low availability of fuel.

Around 12,000 MW of gas plants are stressed assets, 5,600 GW have had no gas supplied to them in FY20, while the rest have limited supplies. The average PLF of India’s gas-based power plants increased by 27.4% in April-July, 2020 as spot LNG prices fell to about $2-$3 million British terminal Units (mBtu).

Source: Financial Express