The first two months of the fourth quarter PAF was 95%. For the second and the third quarter the company recorded 83% and 85% respectively which was as a result of increased supply of coal from India. The steady supply of coal to meet demand will be facilitated by the signed agreement with India, to supply coal which will be fully completed by 2013.
The terms price, demand and supply have their application in the attached article. Supply is the quantity of goods that are available to clients. In the attached article, thermal power corporation effectiveness depends on the amount of coal supplied. Demand is the aspiration to have something for instance, the power produced will be in great demand when the plant availability factor is low, because of scarcity. Price on the other hand is the amount paid back for goods or services provided (Glazer and Hirshleifer, 68). In this case price will stabilize if the supply of coal will be guaranteed as a result of signed pact. Coal therefore is an important natural resource for power production in the economy and to the people who consumes it.
National Thermal Power Corporation or NTPC has shown higher capacity availability or plant availability factor during the first two months of the current quarter, indicating improved coal supply, according to data with the Central Electricity Authority.
This augurs well for the state-run company considering that the previous two quarters were not so good for it and earnings declined due to lack of coal availability. This led to concerns over capacity availability of its thermal plants, which is directly linked to availability of coal.
The plant availability factor or PAF of a plant is the maximum time that it can produce electricity over a given period and is mainly linked to fuel availability. Higher the availability of fuel, higher will be the PAF. NTPCs PAF for the first two months of the fourth quarter was 95%.