Norochcholi Is A Lemon: Junk It! Sell It For Scrap!

By Kumar David -February 2, 2014

Prof Kumar David

This is my third piece on Norochcholi in the last two years; previously, soft and mild mannered gentleman that I am, I expressed myself in polite terms . . . hmm, well! But its just too much now; junk the wretched thing, sell it for scrap, collect insurance, get the Chinese Government to write off the loan; in the long run this will be cheaper and less annoying than pottering around with this Lemon in the hope that it may come right one day. Lemon is an Americanism for a dud, usually a car, which from the time you take home fresh from the dealer is trouble, a flop, chronic. You are stuck with it and the dealer won’t take it back. The equivalent Australian expression is ‘up the gum tree’. Norochcholi Unit-1 has failed about 30 times since it was commissioned; these are no teething troubles, the failures are endemic and betoken defective manufacturing, poor quality materials and probably dumping on one sucker garbage that could not be passed off on some other sucker.

Mind you I am not saying that Chinese electrical plant is generically lousy; not at all. Thousands of MWs are commissioned in China each year and the stuff works fine. The point in this case is that if the customer is a sucker, or if someone on the buyer’s side was on the take, or if competent technical people were excluded from the specification drafting, negotiation and inspection process, well expect to be taken for a ride. I have no inside knowledge of which of these happened, or if it was some other reason, but it’s time to call a spade a spade; or if you don’t mind, let’s call it a bloody shovel.

What is the failure costing?

Let me put things in perspective. All numbers are rounded for ease of memory, but rest assured nothing is so out of shape as to lead you astray. For the same reason the preposition ‘about’ and adverb ‘approximately’ are discarded in this piece. CEB electricity generation in 2013 was 12 terra-watt-hours (TWh), maybe 6% more this year  – I will tell you what a TWh is in a moment – and if Norochcholi Unit-1 (300 MW) was behaving as it should it would be churning out 2.1 TWh per annum or 17% of the needed output. And if it worked well, that is maintained a satisfactory heat-rate in the jargon, the production cost would be Rs 10 per unit. The hydro-complexes generate 3.6 TWh in an average rainfall year, practically gratis. Therefore another 6.3 TWh per annum (53%) is targeted for oil-fired power plant at an average cost of Rs 25 to 35 per unit. The great hope was that when the 600 MW Norochcholi Stage-2 is added, another say 4.2 TWh per annum of cheap (Rs 10) coal power would become available, displacing an equal amount of expensive (Rs 25 to 35) oil-fired power. These price estimates of course fluctuate with world coal and oil prices.                Read More