Toshiba-JSW kick-starts power equipment plant in Chennai

In 2008, then chairman of National Thermal Power Corporation(NTPC) T Sankaralingam had famously said India needed many BHELs if thecountry's power sector were to grow. Those days, BHEL frequently came underflak for failing to deliver boiler, turbine and generators on time, to powerprojects, and thereby, causing time overruns. The public sector enterprise wasblamed for the country missing its capacity addition targets.

The development led to two developments: One, Chinese firmslike Shanghai Electric, Harbin Power Engineering etc., bagging big-ticketorders. Two, leading Indian companies sewing up joint ventures with overseasmanufacturers to make the equipment on the Indian soil. Examples: L&T-Mitsubishi Heavy Industries, Alstom- Bharat Forge, Hitachi-BGR Energy etc.

One such joint venture came to fruition on February 12,Sunday, with the commissioning of Toshiba-JSW facility to manufacture turbineand generators for thermal power projects in Chennai. The combine has investedRs 650 crore so far and the plant will produce equipment for super criticalthermal projects in the capacities of between 500 MW and 1000 MW. (In India, thestandard configurations are 660 MW and 800 MW. While Tata Power has gone for800 MW configuration for its Mundra plant, Reliance Power has gone for 660 MWconfiguration for its four projects.) The Toshiba-JSW facility will have aproduction capacity of 3000 MW by the end of this fiscal year and, the companyplans to double the capacity by 2015 targeting sales of Rs 2000 crore by then.The firm is currently in the final stages of processing the tenders from NTPCfor power projects in Uttar Pradesh and in Karnataka.

The Toshiba-JSW will ship its initial production to thecustomers in India, but willtap export opportunities in the emerging economies in South East Asia, MiddleEast and Africa for the subsequent output.Initially the rotor blades for the turbines will be made in Chennai while therest of the major parts will come from Japan. Once the Indian industriesbecome ready for providing steel for large-scale heavy weight forging, theToshibha-JSW expects overall steam turbine to be made from the Indian material.

Thermal power equipment manufacturers are bullish because India's thermalcapacity addition has been consistently rising. In the 10th Plan period(2002-07), it was 25,417 MW. The same went up to 59,693 MW during (2007-12).The new thermal capacity is expected to be 75,200 MW during the 12th Planperiod (2012-17). According to estimates, the Indian power generation equipmentmarket is expected to see a demand growth of more than 16,000 MW per year inthe decade from 2007 to 2017. Coal-fired thermal power projects will accountfor over 60 per cent of this projected capacity growth. The global market isalso expected to see continued growth in demand for thermal power generationequipment in growing markets, to about 84,000MW per annum by the year 2020.

On Sunday, JSW Energy Chairman and Managing Director SajjanJindal said the new venture was in line with his conglomerate's strategy to bepresent in the entire value chain of power business from equipmentmanufacturing to generation, transmission, distribution and energy trading."Toshiba JSW's manufacturing facility will further contribute to thedevelopment of local industry and will contribute to achieving self-sufficiencyin sourcing of power equipment in India," Jindal said on theoccasion. The JSW Energy, a listed firm, has an operational generating capacityof 2600 MW and is building new plants of 540 MW.