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NTPC Canceled $2 Billion Orders for Buying Emissions-Cutting Technologies

NTPC Ltd. (NTPC), India’s leading electricity producer, canceled the deal worth $2 billion for buying emissions-cutting technologies from General Electric Co. (GE) and other foreign firms on December 19, 2019. The state-owned NTPC had held several talks with foreign firms including GE, Yara International, and  Mitsubishi Hitachi Power Systems to make a deal over transferring technologies, which can help reduce greenhouse emission gases.

Earlier in July 2019, GE claimed that it was awarded the deal to supply the technologies for several coal-fired plants in India. According to the NTPC officials, the main reason for the rejection of the deal was attributed to the failure of the technologies at meeting key emission criterions.

Missing the Deadlines of Emission

Rejection of the technologies will further affect India’s target of reducing emission levels by 2022. More than half of India’s coal-fired plants are likely to miss the promised deadline to reduce sulfur oxides, which is one of the key greenhouse gases and primary causes of lung cancer, which started in December 2019.

As reported by media, “Thermal power plants generate three-quarters of the country’s electricity and account for some 80% of India’s industrial emissions of sulfur oxides that cause lung diseases and smog-creating nitrogen oxides.”

However, NTPC officials claimed that using foreign technologies in these plants would incur high costs and encounter technical difficulties. According to Reuters’ calculations, “The cost would total $2.4 billion, although industry consultants said recently that those costs could now be 25% lower.”

NTPC claimed in a presentation in November 2019 that the emissions-cutting of these plants could be handled with ‘minor retrofits’ without the installation of these new technologies. Meanwhile, Lauri Myllyvirta, an analyst at the Centre for Research on Energy and Clean Air, told Reuters, “India has failed to curtail emissions due to delay and misinformation tactics by the power industry.”

Responses to the Pilot Tests of the Technologies

According to a report submitted by NTPC to the Central Pollution Control Board in November 2019, “The pilot tests concluded that both selective non-catalytic reduction (SNCR) and selective catalytic reduction (SCR) technologies currently available are not suitable for installation at power plants in India.” The officials claimed that none of the tests passed the key emissions parameters as suggested by NTPC.

The board held a meeting with three stakeholders of the deal on November 7, 2019, to discuss the deadlocks of the transfer of technologies. The two tech companies, GE and Yara rejected NTPC’s views and claimed that their technologies were used worldwide. When Reuters approached NTPC and Indian units of GE and Yara, they declined to comment on it.

As reported by the tech companies, “Pilot tests were run in a constrained environment and that commercial use of the equipment, which requires some changes to the plant, would cut emissions to the required levels.” Blaming NTPC, Senthilvel Rangasamy, a GE representative, stated, “The conditions for the (pilot) test were that we can’t touch special parts at all, we can’t touch furnace tubes. NTPC did not allow us.”

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