Railways to import crude oil, install solar power plants to reduce operating costs

Indian railways consume more than 2.8 billion litres of diesel per year with an approximate cost of Rs.18,000 crore, while the transporter purchases about 17.5 billion units of electricity and spends nearly Rs.12,300 crore. The Dollar Business Bureau

The Railways are also toying with the idea of harnessing solar energy to meet its power needs.

The Railways are toying with the idea of harnessing solar energy to meet its power needs.

The government intends to bring down its railway operating costs by importing crude oil and obtaining refining capacity from oil marketing companies over the next five years. This initiative, as the railway’s senior officials call it, would ensure cost optimisation. Cutting down on diesel inventories has already resulted in the railways saving about Rs.2,000 crore and is likely to add to the savings generated from direct purchase of electricity. According to the officials, the Ministry of Railways will begin to implement this initiative from next year. The Ministry plans to generate additional revenue by exporting rolling stock, expanding the freight capacity and monetising its data bank. India’s railways consume more than 2.8 billion litres of diesel in a year with an approximate cost of Rs.18,000 crore. The transporter, on the other hand, purchases about 17.5 billion units of electricity and spends nearly Rs.12,300 crore each year on it. The Railways are also toying with the idea of harnessing solar energy to meet its power needs. This would result in the reduction of conventional fuel conservation and carbon emission, thereby enhancing the burgeoning environment friendly steps that the Railways has been advocating. In this regard, “A bipartite memorandum of understanding (MoU) was signed between Railway PSU Indian Railway Finance Corporation Ltd. (IRFC) & Ajmer Division of North Western Railway on March 8, 2016 in New Delhi for installation of eco-friendly solar power plant of total capacity of 280 KWp at 4 major stations in Rajasthan,” the Ministry of Railways said in an announcement. The Finance Minister Arun Jaitely, in his Union Budget speech, had proposed the commissioning of solar capacity of 1,000 MW over the next five years. “Policy guidelines and tender documents for 50MW solar plants at rooftop have been issued and facility for another 100 MW is being set up. We have commissioned a 25 MW wind mill power plant at Jaisalmer, and we are working towards commissioning 132.5 MW in the next year,” Jaitely said. The government is also considering setting up a dedicated planning and investment organisation to redesign railway board, setup speed and information technology services and ensure strategic appraisal of projects. To meet its revenue targets, the Railway Board looks to focus on monetising Intellectual Property Rights (IPRs) and revamping revenue from advertisements. The Ministry may soon announce a revised freight tariff structure to enhance competitiveness and help railways recover its market share.

March 09, 2016 | 03:12pm IST.

Related Topics:

The Dollar Business Bureau - Mar 09, 2016 09:41 IST

Railways to import crude oil, install solar power plants to reduce operating costs

We like you just the way you are.