• PAGE ONE
• INDEX
• HOME

IDFC to assist solid waste management projects

Our Bureau

CHENNAI, Jan. 23

THE Infrastructure Development Finance Co Ltd (IDFC) has decided to assist municipal solid waste management projects. It has contributed to both the equity and debt of one such project in Lucknow, and is looking at another project in Maharashtra.

According to the IDFC, its participation in the Lucknow project demonstrates that municipal solid waste projects can be structured as commercially viable propositions by balancing the environmental concerns and economic considerations.

The Lucknow project is being implemented by Asia Bio Energy India Ltd, a special purpose vehicle formed for building, owning and operating the project.

The project involves converting about 300 tonnes per day of municipal solid waste into about five MW of power and 75 tonnes per day of organic fertiliser.

``The project is, therefore, the first of its kind that aims at overall and integrated solution to tackling municipal solid waste,'' says an IDFC press release.

The Lucknow project costs Rs 76 crore, with the equity component being about Rs 20 crore. The Chennai-based Enkem Engineers Pvt Ltd, the project promoter, has taken a Rs five crore equity stake.

The others who have taken equity positions include: Entec of Austria, the technology provider, Rs 2.5 crore; Jurong Engineering Ltd of Singapore, the EPC contractors, Rs three crore; CGEA Asia Holdings Pte Ltd France, the O&M contractor, Rs one crore; ID FC Rs 2.5 crore; and two mutual funds together Rs four crore.

According to IDFC sources, its debt exposure in the project will be up to Rs 20 crore. The Ministry of Non-Conventional Energy Sources has provided a Rs 15 crore capital subsidy.

The project provides scope for deriving a host of value upsides like modular expansions at minimal incremental costs and trading in carbon credits, according to the IDFC.

When contacted, Mr P. Subramani, Managing Director, Enkem Engineers Pvt Ltd, said the power plant would use the biomethanation process, which had been developed by Entec of Austria.

This was a wet process. Both the power plant and the organic fertiliser plant were expected to be operational by September 2002. The cost of power would work out to Rs 3.16 per unit, he said. Enkem Engineers is mainly into environmental engineering activ ities.

According to the IDFC press release, the project company has entered into firm agreements with the Lucknow Nagar Nigam for lease of land and for supply of municipal solid waste.

Power purchase agreement has also been entered into with the Uttar Pradesh Power Corporation Ltd. The company proposes to sell the organic fertiliser under a firm offtake agreement with corporate houses.