September 2, 2014 / 11:36 AM / 5 years ago

UPDATE 1-India's financial hub Mumbai hit by big power cuts

(Adds Tata Power statement, context, stock exchange comments)

MUMBAI, Sept 2 (Reuters) - Power cuts hit large areas of Indian financial capital Mumbai on Tuesday following a technical glitch at an electricity generation unit, but back-up generators at banks and brokerages ensured that financial business was largely unaffected.

Tata Power Company Ltd said the cuts, which began at 0945 IST in Mumbai, were caused by a technical fault at one of its units and forced it to switch off power to some areas of the city, including some business districts.

It did not say what had caused the fault at the power station but that it was working to get supplies back on by the end of the day.

Overloading of the state transmission network prevented local electricity distribution companies from importing extra power available elsewhere in India into Mumbai, Tata said.

The National and Bombay Stock Exchanges, India’s largest financial bourses, said the outages had not impacted trading, and local banks and brokers said back-up generators had insured power supplies were maintained throughout the day.

Mumbai has largely avoided the outages that regularly affect much of India.

India does not generate enough electricity to meet rapidly rising demand. Furthermore, a severe shortage of coal, which fuels two-thirds of its energy needs, has raised fears of more widespread blackouts.

“Dark office in Mumbai. Lights out in the whole area. The coal crisis is beginning to literally show its dark side. A threat to the India story,” tweeted industrialist Anand Mahindra, chairman and managing director of Mahindra Group.

According to data released last week, half of India’s thermal power stations have less than a week’s supply of coal on hand, the lowest level since 620 million people in 22 states were hit by one of the world’s worst blackouts in mid-2012.

Any grid collapse would cast doubt on the crisis management skills of the new government led by Prime Minister Narendra Modi, whose achievement in ensuring 24-hour power supplies as premier of the state of Gujarat helped him win election victory in May. (Reporting by Sumeet Chatterjee, Aman Shah and Abhishek Vishnoi; Writing by Tommy Wilkes; Editing by Edwina Gibbs and Jane Baird)

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