— T. Subbarayadu, CMD, Turbomachinery Engineering Industries Ltd
Hyderabad-based
Turbomachinery Engineering Industries
Ltd is a leading player in the power plant business offering
services like R&M, EPC contracting, O&M, re-engineering,
etc.
T. Subbarayadu, in an interaction with
Venugopal Pillai, speaks at length about his company
operations and expansion plans, whilst giving a clear
understanding of the changing dynamics of India's power
equipment and contracting business. He asserts that with
India's power sector witnessing huge capacity addition, the
country must gear up to bridge the big manpower shortfall
in the power plant O&M business.
To begin with, please tell us in brief about the various power plant-related services
offered by Turbomachinery Engineering.
Turbomachinery Engineering Industries Ltd, an ISO 9001-2008 accredited company, is
unique as a single source for total power and process plant services in the areas of
renovation & modernization, EPC contracts, O&M contracts, re-engineering and
relocation of plants for steam & gas turbines and compressors & pumps for more than
two decades, with dedicated units at Hyderabad.
Turbomachinery is one of the very few non-OEM companies globally, having the latest
state-of-the-art technologies and infrastructure, including PLC-based thermal stability
test facility for rotor bend removals, high-speed vacuum tunnel facility for rated speed
balancing, CNC machining centers and CNC EDM centers, R&D center approved by the
government of India for development of new technologies and "Centre for Engineering
Excellence" for development of new products.
Turbomachinery has executed wide range of jobs in the above areas not only in India
but also in overseas locations like Saudi Arabia, Bahrain, Kuwait, Qatar, Oman, UAE,
Nigeria, Algeria, Zimbabwe, Kenya, Thailand, Malaysia etc.
Given that India today has over 1.1 lakh mw of installed thermal power capacity and
most of the future capacity would continue to come from thermal power plants, how do
you see the prospects for EPC and O&M contracts for thermal power plants?
The present installed capacity of over 1.1 lakh mw of thermal power plants is
expected to go up in by an additional 75,000 mw in the XII Plan. More plants are
expected in the private sector. The private owners who are less experienced in this
field would prefer to go in for the EPC route. So EPC business is going to increase
further. Similarly as number of plants are increasing year by year, the O&M
business also expected to go up correspondingly.
Please discuss the importance of retrofitting and refurbishment of
old power plants with a view to improving efficiency of the assets.
How relevant is this for state government-owned power plants that
are old and running at poor PLFs?
Power plants which are in operation for more than 25 years
can be termed as old power plants. It is true that some of the
state-owned power plants are in operation at low
efficiencies and low PLF. Because of the constraints on the
development of materials engineering; design know-how and
the computer applications, old power plants were built with
higher heat rates and low efficiency, compared with today's
power plants that are equipped with advanced technology.
R&M plays a key role in enhancing energy efficiency in old
thermal plants and is increasingly being taken up for
supplementing greenfield capacity addition. Hence for the
same inputs of fuel, a power plant can be retrofitted for
higher efficiencies and higher capacities up to the tune of 10
per cent to 15 per cent. This will reduce the fuel consumption,
auxiliary power consumption and CO2 emissions
substantially. It is estimated that one per cent increase
inefficiency in thermal power plants with Indian coal, could
result in saving of 12 million tones of coal per annum, there
by reducing CO2 emissions by 14 million tonnes per year.
Today's design know-how provides higher reliability of
equipment and hence higher PLF.
Currently, how much of your company's business comes from EPC
contracts for greenfield projects? Do you envisage a change in the
EPC-O&M mix in the years to come?
About 30 per cent of company's business comes from EPC
contracts. We do have plans to enhance EPC and O&M business in
the coming years.
As far as setting up captive power plants for industrial units which
sectors would dominate your business in the medium term?
Today most of the process industries want to have their own
captive power plants for good quality and economical power. We
have our strong presence in the process industries like sugar,
cement and steel, besides fertilisers and refineries. Any
developments in these sectors will improve our business.
Do you have any plans for backward integration, which is to
manufacture main plant equipment?
We have on the cards the plans for manufacturing of steam
turbines, as there are adequate players in boilers, generators and
other auxiliary equipment manufacturing, in the medium range of
power plants.
What is your view on the quality and efficiency Chinese power plant
equipment that is seen to play a very significant role in India's
capacity addition drive, both in the industrial and utility sectors?
Basically there is a change in the design philosophy of the
equipments built in China and India. Chinese generally build the
equipment to operate at an average of 80 per cent PLF, where as
in India it is at 90 per cent. When the Chinese equipment is
operated at higher PLF than designed, there could be problems
with the equipment.
In the industrial sector, Chinese equipment is
standardized, but not custom built. Hence there will be slight
change in the efficiency. Moreover Chinese boiler technology
is not suitable to Indian coal that has high ash percentage.
There are compromises. However, because of short
deliveries and low cost, Chinese equipment continues to
dominate the Indian market.
What is your view on the increasing number of players in the power
main plant equipment space by way of Indo-foreign joint ventures?
It will take at least 3-5 years for these players to get
established. Meanwhile, BHEL is also going for capacity
expansion. So, there will be healthy competition and thereby
costs will come down, and there would be reduced deliveries.
This will put a check on Chinese equipment in the coming years.
Optimum designed equipment will be available in the Indian
market once these players are established.
EPC contracting and O&M services are areas that need
significant technical skills. Given this, what is your view on the
available and emerging pool of skilled engineers? Do you face
skilled manpower shortage?
There will be huge shortage of skilled manpower in the coming
years in the O&M services compare to EPC contracts. When the
country is going to have higher-size power plants with supercritical
parameters, the conventional O&M practices followed in the power
plants today will not be effective. Even a day of shutdown results in millions of rupees lost. Hence there will be a big demand for the
skilled O&M engineers in the coming days.
As far as Turbomachinery is concerned, we are going in a big way
to augment this gap. We have our own engineering institutions built
for providing quality education for diploma, graduates and
postgraduate engineers with special electives focusing on O&M of
power plants, water chemistry, pollution control norms, energy
management etc. Besides, we also provide hands-on experience in
our own power plants.
We understand that Turbomachinery had planned to set up
infrastructure facilities in Gujarat and Chhattisgarh. What is the
present status?
To provide quality and timely power plant services to the customers
spread across central and eastern parts of India, totally dedicated
refurbishment centre with latest state-of-art facilities is being built
at Raipur, the capital city of Chhattisgarh. This will be in operation
by August this year.
The plant in Gujarat will come into operation during 2012-13. The
capital expenditure planned for the next three years will be around
300 crore.
The XII Plan period is likely to see 60 percent of new thermal power
capacity coming from "supercritical" thermal power plants. How is
Turbomachinery gearing up to meet emerging opportunities?
The facilities at our manufacturing division at Hyderabad and
refurbishment division at Raipur are geared up to handle the
supercritical power plant equipment—both for parts
manufacturing and repair and retrofits.
We are in touch with leading manufacturers of power plant
equipments with supercritical parameters for transfer of design
know-how on material engineering and technological processes
and quality control norms besides training of our engineers. We
will be acquiring these shortly.
What is your view on business prospects from the international
markets, mainly in African nations where significant power
capacity addition is being seen?
There are huge business opportunities in the Middle Eastboth
in Africa & Gulf countries. Being a service provider we
have our sales & services facilities at Sharjah, UAE and we
are providing our services both in spare parts supply, repair
& retrofits and field services in the Middle East countries as
mentioned earlier.
Please summarize your future plans for Turbomachinery. What is
your vision for Turbomachinery Engineering for 2015?
Turbomachinery has a road map for the next four years to become
the most preferred and admired global service provider for turbomachines
working in power and process plants, and to provide
more value for money.
By 2015, Turbomachinery should be a
2,500 crore company
with 1,000 skilled engineers and technicians having expansions to
become:
- a preferred engineering company for R&M of power plants
- a leading turbine manufacturer in the mid range
- the most wanted O&M service provider, and
- a preferred EPC contractor