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Bhadrawati PPA signed, work to start in December

Maharashtra Chief Minister Manohar Joshi and Deputy Chief Minister Gopinath Munde today witnessed the signing of the power purchase agreement between the Maharashtra State Electricity Board and the Central India Power Company, a joint venture company headed by the Mittals of the Ispat group, for the Rs 45.56 billion Bhadravati Power Project.

The 1082 MW project, considered to be one of the prestigious eight fast-track power projects in the country, is jointly promoted by Ispat group (53 per cent), Alsthom of the United Kingdom (32 per cent) and Electricity de France (15 per cent) to set up the thermal power plant at Bhadravati near Nagpur in Maharashtra. The PPA was signed following the receipt of counter-guarantee from the Union government for the project last week.

The financial closure for the project would be completed by January and the project work is expected to start from December. According to MSEB Chairman Asoke Basak, the electricity rate from the project would be in the region of Rs 2.50 to Rs 2.60 per unit based on today's coal prices.

However, the rate may vary depending on the coal prices at the time of completion of project which is expected within 43 months from the date of financial closure, Basak said.

Chief Minister Joshi said the state would shortly be getting similar counter-guarantee from the Centre for other projects such as 410-MW Reliance project at Patalganga, Enron phase-II project at Dhabol and Tata Power project.

With the completion of the Bhadravati project, Maharashtra would be a surplus state in power generation, he asserted.

Criticising the previous governments at the Centre for delaying the clearance of fast-track power projects, Joshi said such an attitude of the Centre had slowed down growth and prosperity of the states and their people.

He hoped that two more PPAs would be signed before August 30 for the Reliance and Enron phase-II projects as the state government expected the Centre's counter-guarantees soon. The joint venture company would also make capital expenditure of about Rs 11 billion for development of coal project for the power plant.

The Centre has guaranteed the entire foreign debt component of about $ 800 million for the Bhadravati project while the promoters' guarantee over 85 per cent plant availability for 20 years. The coal for the project will be supplied by the captive mines of another Ispat group company called the Central India Coal Company under separate coal supply agreement.

UNI