A Study of Indian Power Plant MRO (Maintenance Repair Overhaul) Industry

Indian power sector has made significant progress despite legacy industry constraints. The current installed capacity is 140,000 MW and is growing at about 10% annually. The capacity utilization is beyond known benchmarks i.e. national average is over 78% and while NTPC over 92%. Traditional Indian MRO strategy is based on strategic improvisations to obtain the best out of prevailing industry and restricted maintenance windows. Power plant MRO in India faces issues of service and quality response. It presents an area which has scope for systemic improvements. The subject is also important due to linkage to energy efficiency improvement potentials which are central to global climate initiatives. “MRO Study Project” was undertaken by NTPC (along with Frost & Sullivan) with participation of other Indian generating companies to create a holistic industry view to accurately directionalize the improvement efforts. Power plant MRO is a weakly documented subject in India whereas for industrial countries it’s an almost settled issue. The project — which targeted creation of insights into power station and vendor side — therefore called for significant primary research. Teams visited most of the 36 participating Indian power stations and interviewed 40 MRO vendors (out of 200 participants). For best practice reference creation, visits were made to 7 power stations in Germany while information was also gathered from USA, South Africa and China. The project deliverables include a project report and certain data base considered useful to the industry. Indian power plant MRO has evolved around capacity utilization as the centre. The processes are man power intensive characterized by 1000 very small vendors who work for some 140 thermal stations. Survey indicated service and quality issues as well as inadequate technical back up of vendors which is compensated by plant personnel supervision. New objectives of efficiency improvement and costs reduction call for fundamental changes in areas of tooling, craft skill sets and procedures. MRO Destination envisions emergence of new industry components other than workforce providers — maintenance companies, maintenance schools, certification companies etc. The road map for change recommends three key focus areas: tariff structure which incentivizes efficiency improvement through MRO, best practice infusion to the MRO business and contracting processes improvements of power stations. Involvement of international vendors is expected to provide the best practice exposure as well as catalyze changes in the internal systems. Industry level initiative is recommended by creating a platform for accelerating change and cost effectiveness. The paper presents the project process, key data/analysis, salient findings and business opportunities. For India and many developing countries with similar focus, the work could be useful as it provides a structured platform for internal diagnostics on MRO as well as provides the prospective partners (international utilities and MRO service providers) with Indian MRO business nuances and opportunities to better plan possible business tie ups.