Rolls-Royce to enter power sector

By Sushma Ramachandran

NEW DELHI, JUNE 25. Rolls-Royce of the U.K. is planning to make an entry into the power sector here by providing gas-based captive power generation solutions for industrial units largely in Gujarat, Andhra Pradesh and Tamil Nadu.

The British company which has had a presence in India for over a 100 years is now mainly known for manufacturing aeronautical engines as well as diesel generating sets for the oil and gas sectors.

The grand old Rolls-Royce cars have now been hived off for manufacture by Volkswagen which can still use the brand name under a licensing agreement. The legendary brand name will be handed over to BMW in 2003 which will then be authorised to manufacture the luxury sedans known as the Rolls-Royces.

The Volkswagen vehicles of this model will then be termed Bentleys.

The Rolls-Royce of the 21st century is more interested in core sectors such as power generation. The head of the company's Asian Power Generation subsidiary, Mr. Rod Williams, pointed out that the market potential for captive units was huge, but remained untapped.

Rolls-Royce was setting its sights on smaller units of 2.5 MW to 40 MW where it did not have a big competition. In contrast, there were more players for larger units and companies such as Wartsila of Finland, GE of the U.S. and the Bharat Heavy Electricals Limited (BHEL) dominated the market.

Mr. Williams did not rule out a tie-up with BHEL as Rolls Royce was looking for partnerships with domestic companies to enhance the saleability of its generating sets. This would improve prospects for indigenisation of the generating units since the entire set was now manufactured abroad. The aim was to ensure that the infrastructure for the captive unit was sourced from local ancillary units.

He told The Hindu that the company sought to provide not merely gas turbines as part of a captive power generating unit, but was also prepared to set up plants on a turnkey basis. It had already implemented the first such project for Garden Silk Mills in Gujarat. It had set up a captive co-generating 6.5 MW unit.

Rolls Royce had also established a wholly-owned subsidiary, Rolls Royce Energy Systems India Limited.

He said the company was capable of designing, developing, marketing and supporting power systems for both the oil and gas and power generation markets in India.

It was now planning to arrange a series of seminars in Gujarat, Andhra Pradesh and Tamil Nadu to inform potential consumers of the captive power solutions available with the company. The first such seminar in Gujarat was being held with the support of Gujarat Gas, IDBI and the Gujarat Pollution Control Board. The State Government, he noted, supported the use of gas turbines, primarily because natural gas was a clean fuel and availability was expected to be adequate in Gujarat.

Mr. Williams pointed out that Rolls Royce already had a major presence in the oil and gas sector and had supplied diesel engines to the Indian Oil Corporation (IOC), Oil India Limited (OIL) and the Oil and Natural Gas Corporation (ONGC) over the last 40 years.

The company's biggest business activity in this country was in defence, where it had had a longstanding tie- up with Hindustan Aeronautics Limited (HAL) which was manufacturing Rolls-Royce military engines for the Indian Air Force (IAF).

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