A CASE STUDY:
PFC’S ROLE IN ENVIRONMENT MANAGEMENT
OF POWER SECTOR
This case-study addresses the three principles of Global Compact relating to
Environment, particularly to take initiatives to promote greater environmental
responsibility
Problem Area
Indian Power Sector has to grow at the rate of 12% in order to sustain the GDP growth of
7%. Large demand for power generation in India has resulted in overexploitation of
natural resources and the fallout in terms of environmental degradation and resource
depletion is a cause of national concern. Thermal Power Plant is one of eighteen highly
polluting industry identified by Ministry of Environment & Forests (MoEF), Govt. of
India. Large Hydro Power Projects, such as Sardar Sarovar Project, is already amidst
several controversies over issues of submergence & desettlement.
India is committed towards various Global environmental Issues and is a party to several
International Conventions viz. Montreal Protocol, Bio-diversity etc. Ozone Depletion and
Global warming have emerged as the major concern in recent years. The contribution
of energy sector in the global GHG emission is 54%. The contribution of coal fired power
generation in the emission of CO2 is approximately 24% of the total CO2 resulting from
the global use of fossil fuel. However, India's contribution to global greenhouse gases
has been small: with 16% of world population, India's contribution is only 2% of world
fossil fuel carbon emission. However, with accelerated economic growth, increasing
energy intensity and heavy dependence on coal, India's contribution could grow up to 5%
of total GHG by 2025 AD.
The high ash content and low calorific value of the coal available for power generation in
India has resulted in Particulate emission and Ash disposal problems. Most of the old
power stations designed for coal with 25-30% ash content and gross calorific of 5000
kcal/Kg are presently receiving coal with ash content as high as 40% and average gross
calorific value between 2500 to 3500 kcal/Kg. The ash pond size required for every MW
of generating capacity today stands at 0.32 ha. At present, 80 million tonnes per annum
of flyash is being disposed off in the slurry form in ash dykes, which is
likely to
increase to 100 million tonnes per annum by 2005AD.
Ministry of Environment & Forests (Govt. of India) has prescribed several measures in
their guidelines for thermal power generation regarding dry flyash collection at all plants,
100 % ash utilisation within stipulated time frame of 9 to 12 years etc. However, at
present, only a small percentage (3 to 5%) of flyash generated in India are used for
gainful application. In some States, several incentives/steps have been provided for
entrepreneurs to set up projects with flyash as their raw material to promote flyash
utilisation. This includes free dry flyash to entrepreneurs, free land/water/electricity, sales
tax exemption etc. Some states are also going to impose restriction on use of soil for
making clay bricks in the vicinity of the power plant.
Thermal power stations in India have been equipped with ESPs to reduce Particulate
matter concentration in the flue gases. The coal quality in terms of calorific value & ash
content has deteriorated over the years leading to poor reliability of boiler, ESPs and
other auxiliaries etc. At the same time, the environmental standards prescribed for
particulate matter emissions are becoming increasingly stringent leading to operational
and financial pressure on thermal generation.
The burning of fossil fuel generates large amount of CO2, apart from SO2 and NOx. In
India, sulphur content of coal is of the order of 0.2 to 0.6%. Even with low calorific value
of coal in India, Sulphur dioxide is not a major issue except in few areas with excessive
industrial activities. Control of sulphur dioxide is achieved through atmospheric
dispersion. Efforts are being made to control NOx levels by providing low NOx burners
in pulverised coal boilers.
One of the major comprehensive environment upgradation project undertaken by
PFC is Environmental Upgradation of Durgapur Power Projects Limited which included
Augmentation of Electrostatic Precipitators, Related Ash Handling Facilities,
Construction of new Ash Pond and Waste water treatment & recycling etc.
Durgapur Projects Limited (DPL), situated at Durgapur in West Bengal (India), has got a
coal based thermal power plant with a capacity of 395 MW. The details of the units are:Unit No.
1
2
3
4
5
6
Capacity (MW)
30
30
75
75
75
110
Date of Commissioning
10-06-60
10-04-60
23-04-64
19-06-64
04-05-66
03-07-85
The two 30 MW unit are not functional and are undergoing life extension work. The
three units of 75 MW each were having Mechanical Dust Collectors along with ESPs.
The design of the MDC and ESP were based on the prevailing norms/practices and with
‘design coal’ of low ash content of 30%. The design efficiency of this combination set
was 97.5% but with deterioration in quality of coal and deterioration in the efficiency of
mechanical dust collector and ESPs, the outlet dust concentration was of the order of 2126 gm/Nm3 resulting in tremendous amount of environmental pollution and health
hazards.
Environment Protection Act, 1986 specifies a limit of 150 mg/Nm3 for the particulate
matter emission from coal based thermal power plants in India.
As the consequence to the Public Interest Litigation (PIL) of M.C.Mehta Vs. Govt. of
India, Supreme Court of India ordered DPL to renovate their ESPs of Unit-3, 4 and 5 to
meet the statutory requirement of 150 mg/NM3 at the earliest.
The design emission level of Unit-6 (110 MW) was 514 mg/Nm3 which was again higher
than the stipulated level of 150 mg/NM3. The associated ash handling system was also
not capable of handling additional load.
The existing Ash Ponds, where the ash slurry was being pumped, was inadequate to
handle the entire ash production mainly due to increased ash content in the coal available
for power generation. Contractors were employed to evacuate ash ponds and there was
indiscriminate dumping of ash in the vicinity of Durgapur. This resulted in not only
degradation in soil quality but also large amount of fugitive dust emission were taking
place. Stray cases of complain regarding deterioration in ground water quality (may be
due to leaching) was also reported.
Action Taken
Power Finance Corporation gives high priority to environmental protection activities of
power sector. PFC does

Ensure that environmental assessment and social impact assessment of the project
are incorporated in early stages of formulation as a factor in the analysis of
alternatives and design of the project.

Assist the borrowers as necessary in identifying major environmental and social
issues associated to the project.

Assist in the preparation of terms of reference for socio-environmental assessments
(SEAs) of different kinds of projects and keep a roster of Consultants who can help
in preparing assessments and impact mitigation plans.

Monitor execution of SEAs to ensure that they meet acceptable quality standards.

Ensure that costs of mitigatory actions are properly considered in selecting and
costing projects.

Ensure that SEAs are conducted in accordance with the applicable standards.

Monitor implementation of mitigation plans and ensure that actions indicated by the
concerned agencies for environmental clearance are carried out.

Assist borrowers in assessing and proposing solutions for the correction of
environmental deficiencies of power plants already in operation; and

Promote and assist utilities in the creation of units specialized in environmental
aspects of power utilities (i.e. design, monitoring etc.).
So far, PFC has carried out environmental reviews of 28 thermal power plants and
provided technical assistance in preparation of Environmental Upgradation Action Plans
(EUAPs) with time bound implementation schedule. This has helped in prevention and
control of the pollution of air, water and land from these installations.
To give extra focus and priority in implementation of environmental schemes, PFC has
relaxed several loan conditionalities for environmental upgradation activities. It has
sanctioned loans worth US $ 100 million for schemes related to the augmentation of
pollution control facilities and other environment protection schemes upto financial year
2000-01. The major environmental activities being funded by PFC are:








Augmentation of Electrostatic Precipitators
Augmentation of Ash Handling Plants
Dry Flyash Collection Systems
Ash Ponds
Dust Extraction & Suppression Systems
Waste Water Treatment and Recycling
Environment Monitoring Equipment
Flyash Utilisation Projects
PFC has also got a provision for financial assistance to power utilities for undertaking
studies to improve the performance and to assist in the development of Power Sector.
PFC offers various types of Grants/Interest free loans / Soft loans for different types of
studies. A grant up to a maximum of US $ 0.2 million per project is available under this
scheme.
Flyash management is also a key area of focus. One activity which PFC has funded very
pro-actively is regarding putting up dry flyash collection facilities in the existing TPSs.
Presently also, PFC is appraising about ten proposals for dry flyash collection systems for
MSEB, MPEB and some other SEBs’ units. Such action is likely to result in large scale
flyash utilization. PFC is also keenly evaluating flyash utilisation proposals for possible
funding including demonstration of new technologies.
In all PFC funded new projects, PFC ensures that various requirements of regulatory
authorities put in the form of conditionalities are built in various contract documents and
adequate fund is available to implement these measures. PFC has also funded several
schemes related to augmentations of ESPs and associated ash handling facilities in the
old power stations of electricity boards all over the country. Typically these schemes
have resulted in reduction of emissions of suspended particulate matter from thermal
stations from high levels of 20-40 grams per cubic meter to 150mg/NM3 or even less.
In the area of waste management, it has been PFC’s endeavors to help the utilities
appreciate and adopt the ”zero discharge concept”, particularly in the thermal stations
located in the water starved areas of the country. To implement these ideas PFC has been
regularly funding activities related to Waste Water Treatment and Recycling as well as
Augmentation of Ash Handling Plants for re-circulation of ash water, thereby reducing
water pollution load from thermal power stations and in savings on water bills. Treatment
of waste water and its re-use results in reduction in the total water consumption for the
station and stops the discharge of waste water containing high amount of suspended
solids, high pH etc. into the fresh water bodies near the thermal station.
In an ash water recirculation scheme being implemented at Parli thermal station of
Maharastra State Electricity Board(MSEB), where PFC has been involved throughout the
implementation process, total water savings is estimated at 11,000 m3/day. Besides the
saving in water consumption, there are other indirect social benefits of such schemes that
can be traced to reduced health costs and increased agricultural productivity due to the
implementation of water recycling schemes. Similar schemes have been implemented at
Koradi and Bhusawal stations of MSEB as well. Such schemes are also being promoted
in other thermal stations of various electricity boards.
PFC’s contribution in environment upgradation of DPL:
PFC had carried out environment review of DPL and assisted in preparation of time
bound Environmental Upgradation Action Plan (EUAP) for the plant. PFC also assisted
in identifying and prioritizing the environmental upgradation schemes. Subsequently,
PFC assisted DPL in formulating techno-economically effective environment upgradation
schemes. PFC was also involved in preparation of bid documents, technical specifications
etc. The following activities were taken up by DPL with PFC’s financial assistance:(a) Unit-3,4 & 5
- Dismantling of existing MDCs and ESPs.
- Three new Electrostatic Precipitators with design efficiency of 99.73% and outlet
concentration of 135 mg/NM3.
- On-line monitoring system for particulate matter, SO2 and NOx.
(b) Unit-6
- Adding two retrofit ESPs in series with each of the two gas paths.
- Adding additional 5 fields parallel to each gas path of existing ESPs.
- Semi-pulse controller in place of existing T/R set controller.
(c) Unit-1 & 2
- New ESPs are being put up under Life Extension Programme of Unit-1 & 2.
(d) New Ash Pond
- New ash pond with holding capacity of 0.9 million m3 with a dimension of
400m x 300m x 7.5m.
(e) Augmentation of associated ash handling system.
Status
The plant is undergoing major life extension work and hence is not available for
generation. However, the augmentation of ESPs in Unit-3, 4 & 5 has been completed.
This augmentation work would result in reduced particulate matter load of the order of
552 T/day to the environment resulting in better environment condition in the vicinity of
the power plant. Augmentation of other ESPs are in progress. Improvement in ambient
air quality due to the augmentation work would result in better visibility, less asthmatics
problems and general improvement in the health of living being around the plant area.
The new ash pond is being constructed. The indiscriminate dumping of ash offsite would
stop thereby improving upon soil quality, air quality and ground waster quality in the
vicinity of the plant. Various ash utilizations proposals are also being formulated.
Another proposal for treatment and re-cycling of ash pond overflow and other waste
waster streams has been formulated and would be implemented in near future.
Lesson Learnt
It is possible to renovate old power plants to meet the present environmental stipulation.
This would lead to sustainable development of power sector by minimizing
environmental impact of coal based power generation.
Contact:
Mr. Deepika Malik
Email: deepimalik@yahoo.com