Monday, April 23, 2007
Sumana Guha Ray / Mumbai April 22, 2007
JSW Energy, the energy arm of the Sajjan Jindal Group, will invest close to Rs 15,000 crore in the next two to three years in thermal power projects in the western part of the country. The company is aiming at increasing its power generation capacity to 5,000 mw from the current 260 mw.
JSW Energy is looking at investing in hydel power plants in Himachal Pradesh and the north east, while extending its presence in the transmission and trading sector to “become India’s largest integrated player in the power sector by the end of the 11th plan (2012),” said the company’s joint managing director and chief executive officer Raaj Kumar.
The company has formed special purpose vehicles for the development of thermal power plants in Rajasthan, Karnataka, Maharashtra and Gujarat. “We have also been actively participating in bids for the development of a transmission network in the country and we already have an in-house power trading wing, JSW Power Trading Corporation based in Delhi,” Kumar added.
The debt-to-equity ratio for these investments would be 75:25. The company has already tied up with several Indian banks for the purpose. The equity component would be funded mostly through internal accruals and carbon trading, Kumar said. The company has already signed a memorandum of understanding with Gujarat for developing a 2,000 mw imported coal-based plant at Simar in Junagarh district. The land survey for the project has been completed and a consultant has been appointed for a techno-economic feasibility study for this port-based power plant, said N K Jain, vice-chairman of JSW Energy. The estimated investment in this project would be Rs 4,800 crore.
JSW has also undertaken brownfield expansion of two units of 300 mw each in Vijaynagar, where it already has a 260 mw generation unit and operates and maintains another 290 mw facility, Kumar said. This plant is expected to be commissioned by December 2008 and would involve an investment of Rs 1,860 crore. The company has already tied up with IDBI for funding.
A third imported coal-based plant would be developed at Raigad in the district of Ratnagiri in Maharashtra. The plant capacity would be 1,200 mw and the investment close to Rs 4,500 crore. JSW has already acquired 1,000 acres for the project. It has already received the ‘no objection’ certificate from the Maharashtra Pollution Control Board and the Ministry of Environment and Forests is expected to provide the certification soon. The construction is expected to begin soon, and the first unit of 300 mw would be commissioned within 27 months from the time of the construction.
The coal requirements would be four million tonne for every 1000 mw thermal power generated. By 2010-11, the company would be importing approximately 15-16 MMT of coal. To ensure fuel security, JSW is looking at acquiring coal blocks in Indonesia, where it already has a stake in a coal block with a yield of 1.5 MMT, Kumar said.
In Rajasthan, JSW is in the process of setting up a lignite-based 1080 mw power plant at an investment of Rs 3,500 crore. The company has already signed power purchase agreements with distributors in Rajasthan for 1000 mw, at a 30-year levelised tariff of Rs 1.91 per unit, excluding escalations. The first year tariff would be Rs 2.28 a unit, while the fuel cost would be between 80 paise and Re 1 a unit, Jain explained.
This project will have eight units of 135 mw each, the first of which is expected to be commissioned by the fourth quarter of 2008.
Wednesday, April 18, 2007
Alphonso farmer Uday Jog’s produce is down 75 per cent this year after November showers and an unusually warm winter battered mango orchards along the Konkan coast, where orchards nestle between pristine beaches and rolling hills.
But that does not worry him.
Mango farms along the lush coast of India’s most industrialised state are on the thresh-hold of unprecedented opportunity, global and local, fuelled by deregulated markets in Japan and the US and by the agricultural boom powered by Indian retail companies like Reliance, Bharti and Pantaloons (Big Bazaar).
What does worry Jog is the effect a proposed 1,200 megawatt (MW) thermal power plant — burning 4.1 million tonnes of coal each year — just outside his village of Nandivde, 290 km south of Mumbai, will have on his 250 mango trees.
Jog’s fears came in a rush of thoughts. “Mango trees flowers just once a year, and the crop is very delicate,” he said. “The changes in temperature, the emission of fly-ash over a 20-km radius will make the dew acidic…will all this not damage my trees?”
The plan for the plant (by JSW Energy Ltd, formerly Jindal Thermal Power Company), spread over 1,025 acres, comes with an associated port to import the coal and is currently before a central committee seeking environmental clearance.
“The plant will be functional 27 months after work begins,” said Raaj Kumar, CEO JSW Energy Limited. In mango country along the Konkan coast, six planned coal-fired power plants (see graphic) could help end the growing state of darkness.
Maharashtra’s power shortfall is 5,500 MW and growing, even as the government makes frantic efforts to generate more energy to power everything from industries, malls, homes and booming small towns.
From this week, power cuts in Mumbai’s eastern suburbs and Navi Mumbai will increase by an hour or two from the daily four-and-half-hours. In other parts of the state, the power will now stay off for more than 15 hours.
But farmers like Jog produce 2 lakh metric tonnes of the lucrative mango each year and farmer groups said they would like a cumulative assessment of how these projects might impact the region’s environment, and agriculture.
Their fears come at a time when mango-growers are looking at an unprecedented opportunity for their fruit to travel the world. The US and Japan have lifted decades-old bans on the import of Indian mangoes. Until now, Konkan mangos were largely sold within the state and exported mostly to the Middle East.
Jog walked HT through his 6-acre farm and explained his new global life. The farm proudly displays a Euro certification that he secured last year. With it, Jog’s mangoes now meet more than 300 stringent production norms and can hit supermarkets shelves across Europe.
Agriculture experts said it’s too early to say if the new power plants could kill the Konkan mango farmer’s aspirations but opposition to the plants has already led the state government to decide not to locate a planned mega-power plant at Girye. It is now looking at alternative sites and the Central Electricity Auhtority has given it till the end of the month to find one. If it can’t, the state loses the plant.
The region’s largest agricultural university, the Konkan Krishi Vidyapeeth is currently finalising an agreement with JSEW to conduct a Rs 2.5-crore three-year study to assess the environmental impact of the power plant on mango crops
“We will be simulating atmospheric conditions of higher sulphur and nitrogen dioxide akin to what condition will be when the power plant is functional, and looking at its impact on mango plants of various ages,” Vice-Chancellor Vijay Mehata told HT. “The College of Fisheries will study the impact on fishing incomes. We should be able to have definite conclusions at the end of the three-year study.”
The locals are not satisfied, and protesting farmers have formed the Ratnagiri Zilla Jagruk Manch (Ratnagiri district awareness forum) and moved the Bombay High Court on what they say is a faulty Environmental Impact Assessment (EIA) report and public hearing process. The court will hear them on April 19.
“The local ecology is far more delicate and complex than depicted in the EIA report,” said Forum head and mango farmer Vivek Bhide of Malgund village. “We would like an independent panel of 5-6 experts to conduct the study and the government to fund it. What use is a three-year-study if plants have already been cleared?”
Locals point out that the Konkan is one of the state’s rare areas where agriculture still delivers prosperity to farmers. They refer to Vidarbha, the Punjab-sized northern region, where cotton farmers regularly commit suicide as the cotton economy collapses. “Farming gives us work 365 days a year,” said Jog. “Does the government want to send us the Vidarbha way?”
Tuesday, April 17, 2007
MERC pulls up MSEDCL over seeking more power cuts
“At a public hearing held in Pune, MSEDCL had cited non-availability of generation capacity of the Maharashtra State Power Generation Co Ltd (MSPGCL) and the National Thermal Power Corporation (NTPC) as one of the main reasons for reduction in supply. Since many of these outages are planned, they should have been factored into the plans,” he said. The power shortage in the state has gone up to 6,800 mw from 5,500 mw, stated MSEDCL.
Deo said that the reply from MSEDCL was not very satisfactory and therefore Merc had asked the company to furnish more details. “In February 2007, Merc directed MSEDCL to regulate consumption by high transmission industrial units up to 80%, failing which the units would have to suffer a second day of load-shedding. Now MSEDCL states that the units have not been following directives,” Deo pointed out.
MSEDCL’s proposal to increase load-shedding by two-and-half hours across Maharashtra came in for flak from both the industrial and agricultural sectors.
The Confederation of Indian Industry (CII), opposed the second day, on the grounds that it would affect the SME sector. CII stated that the move would impact larger companies since SMEs were major contributors to this sector. It said that it would talk to its members to take the Pune model to Nashik, Kolhapur, Nagpur and Aurangabad.
Tuesday, April 10, 2007
Two years after it signed memoranda with several independent power producers (IPPs) to generate 12,500 MW, the state government has stepped in to resolve the issue of land allocation to them.
On Monday, Revenue Minister Narayan Rane and Energy Minister Dilip Walse-Patil assured a smoother land acquisition process after Chief Minister Vilasrao Deshmukh passed directives last month.
In March 2005, the state signed a deal with Reliance Energy Limited (REL) for a 4,000 MW plant. The Tata Power Company (TPC) and Essar too signed MoUs for two 1,500 MW power plants. GMR, Ispat and Jindal each signed deals to put up three 1,000 MW power plants while Spectrum agreed to build a 500 MW capacity plant in the state.
REL and TPC completed all formalities last year and identified land in Shahpur near Alibaug in Raigad district. However, lack of coordination between the revenue and industry departments led to an overlap of 1,000 acres of land that was to be allocated to both the companies.
Last month, Deshmukh ordered that the companies receive land based on their project sizes. Sources close to Rane said he has asked his department to settle the REL-TPC issue in two weeks. The directives also ask REL to relocate its gas-fired facility from the existing site. Both the companies will be allowed to set up coal-based plants.
Jindal is another company that plans to set up a 1,000 MW coal-based plant in Niwadi in Ratnagiri. “The company has got all clearances but doesn’t have land to start work,” said a company official on condition of anonymity as he was not authorised to speak to the media. “The minister has promised to resolve the matter in four days,” he said.
Private participation in power generation is a necessity for the state, which faces a deficit of a staggering 5,500 MW. With each passing year, the deficit is expected to rise by 1,000 MW. Even if half of the IPPs (that have signed memoranda with the state) start generating power in the next four years, the state will benefit from the additional power.
Maharashtra asks Reliance Energy to scale down Shahpur plan
BS Reporter / Mumbai April 10, 2007
The Maharashtra government has asked Reliance Energy Ltd (REL) to scale down its project at Shahpur village in Raigadh district.
This, the government hopes, will help resolve the dispute between Tata Power Company (TPC) and REL over a 1,300-acre plot in the village where both want to set up plants.
While TPC proposed a 1,600-Mw project on the plot, REL planned to set up two projects – a coal-based plant for generating 1,200 Mw and a gas-based plant for 2,800 Mw. The state government has now asked REL to drop the gas-based project.
State government sources said the site was not suitable for gas-based power projects as there was no major gas pipeline in the area. REL executives refused comment.
However, REL had been assured that it would be given all help for setting up power plants anywhere else, sources added.
REL had approached the state revenue department for acquiring 3,460 acres under the Land Acquisition Act, 1894. Tata Power simultaneously approached the Maharashtra Industrial Development Corporation (MIDC) to acquire 1,317 acres under the MIDC Act. Both were allotted the same plot.
Monday, April 9, 2007
India plans large nuclear power plant in collaboration with European countries
NEW DELHI (The Associated Press) - Apr 6
India plans to build a large atomic power plant in the western state of Maharashtra, encouraged by the civilian nuclear deal with the U.S. that will help the country access the international market for nuclear fuel and technologies, a news report said.
State-run Nuclear Power Corp. of India Ltd. plans to build the 10,000 megawatt plant using European pressurized reactors, or EPRs, from France, Germany and Finland, the Financial Express newspaper reported.
EPRs are third generation nuclear reactors that feature better safety standards and significantly contain radioactivity in the event of an accident.
The plant, comprising six units, each having the capacity to generate 1,650 megawatts of electricity, will cost 500 billion rupees, or $11.4 billion, the report said quoting S.K. Jain, chairman of the Indian company.
The investment amount will be raised through a combination of equity and debt, including loans from multilateral development agencies, the report quoted Jain as saying.
India currently operates much smaller plants with a combined capacity of less than 4,000 megawatts, mainly because of lack of adequate nuclear fuel supplies.
Construction of the plant is expected to start next year, Jain said.
It wasn't immediately clear if companies from European countries would also have equity stakes in the project. The report didn't elaborate on financial aspects.
Officials at Nuclear Power Corp. could not be reached for comments as government offices were closed to mark the Good Friday holiday.
The 45-nation Nuclear Suppliers Group bars its members from exporting nuclear fuel to India because New Delhi has refused to sign the Nuclear Nonproliferation Treaty.
The agreement with the United States, which was cleared by its Congress last December, seeks to lift that ban.
Encouraged by the deal, India plans to increase nuclear power production nearly 10-fold to 30,000 megawatts in 20 years. That target could go up if India allows domestic private companies to enter nuclear power generation, which is currently limited to state-run utilities.
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Friday, April 6, 2007
|NTPC eyes LNG gas terminal of Dabhol|
New Delhi, April 06: National Thermal Power Corporation (NTPC) today said it was keen to acquire the five million tonne LNG terminal of the 2,150 MW Dabhol power plant at Ratnagiri in Maharashtra and was ready to put in Rs 500 crore in the project that has yet to take off.
Our board has cleared the infusion of Rs 500 crore into RGPPL...We will do so as and when the government expects us to do that, Chandan Roy, Director (Operations) of NTPC said here.
NTPC was keen to acquire the 5 million tonne liquefied natural gas (LNG) terminal linked with the 2,150 mw Dabhol power plant.
The corporation's move comes after another RGPPL promoter Gail (India) said last month it was also willing to infuse Rs 500 crore into RGPPL provided it was given the LNG terminal.
Both NTPC and Gail had put in Rs 500 crore into RGPPL to acquire 28.33 per cent each at the time of taking over Dabhol assets. Maharashtra state electricity board and IDBI-led lenders control the remaining equity stake in RGPPL.
The empowered Group of Ministers on Dabhol was exploring the options of infusing additional money into RGPPL, so as to complete the revival process of the power plant and LNG terminal.
Already, the revival cost has shot up to Rs 12,600 crore from Rs 10,300 crore estimated earlier.