India’s Power Projects have been facing trouble owing to uncertainty in fuel supply and regulatory hurdles. Many Power companies have put their projects on sale with combined capacity of over 40,000 MW in FY13.

Foreign players are finally showing little interest with selective and conditional approach on India’s cash strapped Power sector, after 20 distressed Power Projects on sale for over a year.

Over a year ago, problem in fuel supply and irregular production have resulted in several companies to put their Power projects on sale. These companies are:

– Lanco Infratech’s, 3 Coal based Power projects with a combined value of USD 25 billion

– Lanco’s 70 MW Hydro Power project valued at around USD 7.5 billion

– GMR group’s 600 MW EMCO plant worth USD 40 billion

– Aban Offshore ‘s 2 Power projects with combined capacity of 2,520 MW

Many small players are struggling to deal with existing capacity and completion of ongoing projects. Some of them are even looking for a complete exit.

RKM Power & Ind Bharat are looking for selling majority stake in their Power business; and Ind Bharat is in talks to sell its 660 MW Coal based plant in Odisha. However, none of these projects have found too many domestic buyers.

But, they have some hope at the end of the year. Global big players like Abu Dhabi’s Taqa or GDF along with utility companies such as Sembcorp & Genting Group from Singapore & Malaysia have focused on India’s projects and shown interest in the power space.

“Many foreign players for the first time have started looking beyond their home country for investment. Since their local demand is slow and they want to change their strategy, basically they are hedging their bets and looking beyond their home markets”, said by Kameswara Rao, leader- Energy, PWC India.

Foreign players have only focused on those projects where tariffs are in line, with costs and fuel linkages situated near project.

“We have to first deal with different issues related with Coal availability and other such regulatory hurdle, before this interest become wider”, experts said.