CASE NO. 35 of 1998

Present:
Shri S. C. Mahalik, Chairman
Shri A. R. Mohanty, Member
Shri D. K. Roy, Member

For Petitioner:
Shri B.M. Sarangi, Sr. General Manager of M/s. Tata Sponge Iron Ltd.

For Affected Party:
Shri B.P. Rekhani, General Manager (Regulatory Affairs Unit), GRIDCO.

Date of argument: 05.03.99

Date of Order : 17.03.99

1.0 M/s. Tata Sponge Iron Ltd. (TSIL), the applicant, is an industrial unit engaged in production of sponge iron, located at Bilaipada near Joda in Keonjhar District of Orissa. The applicant is reported to be in operation since 1986. The applicant has sought permission under Section 21(3) of the Orissa Electricity Reform Act, 1995 (hereinafter, for short, the Act, 1995) read with Section 44 of the Electricity (Supply) Act, 1948 (hereinafter, for short, the Act, 1948) to set up an additional 2 nos. 1000 KVA D.G. sets at their plant to run as stand by unit during the power interruption from Gridco.

1.1 According to the application and subsequent information furnished to the Commission, the applicant's process industry involves production of sponge iron with the help of rotary kiln through direct reduction process which is continuous in nature. The applicant has also stated that the power interruption even for a short spell, destabilises the manufacturing process. Power failure creates two types of losses viz. (a) production loss, and (b) damage to the sophisticated equipments due to thermal shock. It has been further stated by the applicant that restoration of their destabilised process takes a longer time than the interruption period of power supply to resume the production. The applicant has also indicated that at present there are 3 nos. 1000 KVA diesel generators to take care of such special protection required for their industrial process during the power interruption. The necessity for the additional 2 nos. 1000 KVA diesel generator has arisen because they have in the meanwhile expanded their production capacity by adding one new kiln since September, 1998. They have further stated that in view of such additional plant load they have enhanced their contract demand from 2800 KVA to 4400 KVA with Gridco since 23.03.98.

1.2 It is averred that for the production of sponge iron for both the kilns the basic minimum load of 3500 KVA needs to be protected from the power interruption with the help of self generation to avoid production difficulties as stated earlier.

1.3 To meet such essential plant load of 3500 KVA out of their contracted demand of 4400 KVA, the applicant stated that they would require 5 nos. 1000 KVA capacity DG set taking into account one DG set as stand by in the capacity of captive power installation.

1.4 The applicant also stated that the consent for existing installation of 3 nos. 1000 KVA DG set were given by erstwhile OSEB and they are also allowed to run these DG sets in parallel with the Gridco system when prior information for power outage was available from Gridco for smooth change over of power supply.

1.5 On these grounds the petitioner prayed for permission for additional installation of 2 nos. DG set, each of 1000 KVA capacity with a provision for operating them in parallel with Gridco system when planned outages are availed by Gridco with prior information.

2. The respondent (M/s. Gridco) in its reply/counter dt.12.02.99 has stated that the power supply to the petitioner has been augmented through a direct 33 KV feeder from 33 KV bus at Joda Grid sub-station and that apart the petitioner has an installation of 3X1 MVA DG sets to run during the period of power shut down. Therefore, this should be considered as sufficient to meet the essential load during interruptions of power supply from Gridco. It is further averred that in view of the above, installation of additional 2 X 1000 KVA DG sets may not be necessary.

3. In course of the presentation of the case, the following facts emerged :-

1. The petitioner has already built a second rotary kiln to augment its production of sponge iron since 01.04.98.

2. Sponge iron manufacturing process is highly power sensitive industry.

3. Notwithstanding Gridco's effort of making the power supply available through 33 KV dedicated feeder, there has been interruption. These interruptions may be less than earlier period when the petitioner was availing power supply at 11 KV system.

4. Power outages/failures cause production loss and dislocates the process of production and there are genuine difficulties in restoration of the production process after supply interruption.

5. The essential load for the plant is around 3.5 MVA and this fact is not contested by Gridco's representative present at the hearing.

4. In the facts and circumstances of the case, the Commission considers it appropriate to grant consent for installation of 2 nos. 1000 KVA DG set each for stand-by operation during the power failure with a provision to operate them in parallel with Gridco system only in case of power shut down programmed by Gridco.

5. The consent granted at para 4 above shall however be subject to compliance of the following conditions:

1. An energy meter duly tested should be installed near the DG set for recording the energy generated and consumed. The meter should be duly sealed by the concerned A.E. Inspector.

2. Installation drawing should be approved by the Electrical Inspector, before actual installation of the set.

3. The installation shall be energised only after written permission of Chief Electrical Inspector, Orissa/Electrical Inspector, Orissa or his authorised representatives.

4. The electricity duty as due to State Government shall be paid within the prescribed time.

5. The permission granted is liable to be withdrawn at any time if any one or more of the conditions are violated.

6. The Diesel Generating Set shall conform to the specifications stipulated in the application.

7. The consent for installation shall remain valid for a period of 12 months from the date of issue and shall lapse automatically, if the unit for which permission now granted is not installed during that period.

8. The applicant shall not, without further consent of the Commission, make any material variation in the particulars so stated in this order as per Section 44(2) of the Act, 1948.

6. The petition for grant of consent is accordingly allowed.

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