Raw Material and Operations Cost Ntpc
Autor: pranav siddharth • December 8, 2015 • Case Study • 1,378 Words (6 Pages) • 779 Views
Raw material and Operations cost
NTPC’s operational cost majorly revolves around fuel cost. Other costs include employee remuneration and Generation, Administration and Other expenses. Fuel is the prime input for power generating companies and in the case of thermal power stations the fuel comprises of Coal, Natural gas, Oil and Naphtha. A detailed operational cost breakup for the past five years.
Expenses | 2013-14 | 2012-13 | 2011-12 | 2010-11 | 2009-10 |
Fuel | 45829.71 | 41018.25 | 41635.46 | 35373.78 | 29462.74 |
Employee | 3867.99 | 3360.12 | 3090.48 | 2789.71 | 2412.36 |
SG&A | 4543.85 | 4211.22 | 3588.79 | 4926.28 | 2808.71 |
Table x. Cost break up for the past 5 years.
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Image x. Operational cost break up
Fuel Cost
In thermal power stations superheated steam is used to run turbines. Fuel is used to convert water in boilers to superheated steam. NTPC uses coal and natural gas as their prime input, coal comprised 89% of the total fuel cost. Increase in cost of fuel can be mainly attributed to capacity expansion and increase of prices of coal. Gas is sourced domestically and prices are under administered price mechanism regime.
Fuel breakup | 2013-14 | 2012-13 | 2011-12 | 2010-11 | 2009-10 |
Coal | 89% | 80% | 82% | 80% | 76% |
Gas | 8% | 15% | 15% | 15% | 14% |
Oil | 1% | 1% | 1% | 1% | 5% |
Naphtha | 2% | 4% | 2% | 4% | 5% |
Table x. Percentage breakup of fuel used
Fuel breakup | 2013-14 | 2012-13 | 2011-12 | 2010-11 | 2009-10 |
Coal | 40788.44 | 32814.6 | 34141.08 | 28299.02 | 22391.68 |
Gas | 3666.377 | 6152.738 | 6245.319 | 5306.067 | 4124.784 |
Oil | 458.2971 | 410.1825 | 416.3546 | 353.7378 | 1473.137 |
Naphtha | 916.5942 | 1640.73 | 832.7092 | 1414.951 | 1473.137 |
Table x. Fuel cost breakup in absolute terms (in Crores)
Manpower cost
Employee cost comprised of 7% of the operational expenditure in FY2014. Employee cost comprises of salaries and wages, bonuses, allowances and other welfare expenses. Increase in manpower cost can be attributed to capacity expansion.
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