India’s gas-power sector suffers from gas shortage

The Indian government is considering new measures in order for gas generators to meet gas power generation targets.

At the moment India’s fertiliser sector has priority over power generation, when competing for the country’s present gas resources, a situation the Indian Central Electricity Authority (CEA) is attempting to address.
Gas power plant
In the meantime the CEA has had to reduce its gas-fired generation target for the current year by almost 46 per cent amid the supply shortages. Low natural gas production output last year is expected to continue through 2013, an official told The Economic Times, despite Reliance Industry’s recent announcement of a “significant gas condensateà‚ discovery in deepwater KG D6 block”.

The energy ministry has now put forth two options for freeing up gas volumes for power generation. The first option is to give equal priority to buyers in the fertilisers, LPG, power and city gas distribution sectors, and the second is for giving equal priority to just fertiliser and power sectors.

Because of the present uncertainty developers have been reluctant to press ahead with proposed power plant projects.

For example, Summit Group has several times extended a deadline to obtain funding for a 341 MW combined-cycle gas-fired plant near a gas field by Bangladesh, Bibiyana 1.

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