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Biomass Power high fuel costs makes it less competitive

Biomass Power Plants in Tamil Nadu have reduced their power generation capacity as the demand has come down. Since May 2013, the state government has allowed unconditional intra-State third party sale which has resulted in reduced power shortage for HT consumers. The current cost of per unit of Rs.6.5 from biomass power plants is costlier by Re.1 which finds few takers. The generation has been selling 20-25 MW in October 2013 from 100 MW last year. This has also resulted in decrease in off-take of agricultural residues from farmers who in turn have petitioned the government. We have to wait and see whether government can bring a preferential tariff to biomass producers

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