Centre working on inter-state power ventures

With its ultra mega power projects attracting huge investments, the Power Ministry is now working on a scheme to encourage state governments to get together and set up projects using fuel linkages that are already available with them. Though the proposal is yet to be finalised, Power Ministry officials said the aim of the project is to provide a framework that will enable states to best utilise the fuel linkages that have been provided to companies, including the state government-owned public sector entities.

Take the case of Kerala, for instance. The state wants to source coal-based power and, along with other states, is working on a proposal to set up such a project in Orissa and thereafter, transmit a portion of that power back to the state. Kerala8217;s initiative for a coal-based power project stems from the extremely low tariff that some of the ultra mega power projects have been able to attract. In fact, the Kerala Government has asked for NTPC8217;s advice on how to put together such a project for the state.

In an ultra mega power venture, it is the Centre 8212; in coordination with the beneficiary states 8212; that launches a shell company and once all clearances are in place, offers the project to the bidder who quotes the lowest tariff. The capacity limit for any ultra mega power project is 4,000 MW and it uses supercritical technology where a unit size is 660 MW and above. The new variant of this scheme is expected to be of slightly smaller capacity and could be around 2,000 MW. However, Power Ministry officials clarified that these details are not yet decided.