The Hindu Business Line : Reliance plans Rs 8,000-cr power plant in UP

RELIANCE Industries Ltd (RIL) plans to set up a 2,000-3,000-MW power plant in western Uttar Pradesh, involving an investment of nearly Rs 8,000 crore.

"We have already shown them some sites in western Uttar Pradesh. The company is examining different locations and we expect the proposal to assume concrete shape soon. They have indicated a requirement of about 2,500 acres of land." the Chairman and Managing Director of UP Power Corporation Ltd, Mr Arun Mishra, said here on Friday.

Reliance officials could not be contacted for comments. The company had earlier announced its plan to set up a power plant in the vicinity of Delhi, and the Uttar Pradesh Government official said Dadri in Greater Noida could be chosen by the company for its project.

Meanwhile, the Tatas are set to take over the 350-MW hydel project in Srinagar, which is now in Uttaranchal. "Although the site is located in the new State, it has been declared a Uttar Pradesh Government project. We hope that with the Tata Group taking over the project, it will take off soon," Mr Mishra said.

The State recently announced a new power policy that seeks to encourage private sector participation in production, transmission and distribution and hopes that other private companies will also come forward to enter the sector in a big way.

Uttar Pradesh produces nearly 2,500 MW and purchases about the same quantum from outside sources. The total requirement, however, is at least 6,500 MW. As part of the ongoing power sector reforms, the State is projecting a total requirement of nearly 14,000 MW till 2012 to reach the national average in consumption. Meanwhile, availability will touch just 8,650 MW till 2009-10 if all planned projects go on stream.

"There is tremendous scope for private sector power producers in the State. We are encouraging them to use the liberalised norms under the new policy to enter all segments — production, distribution and transmission," Mr Mishra told Business Line.

As part of the new policy, the Government is offering interest-free loan of an amount equivalent to the entry tax and State trade taxes along with a tax moratorium ranging from seven to 12 years for the private sector. In addition, land will be made available at acquisition cost, and stamp duty will be waived off, Mr Mishra said.

Speaking at an interactive session on the new policy here, the Power Secretary, Mr R.V. Shahi, asked the State Government to speed up the rural electrification process and assured that necessary funds would be made available for the purpose.

"We want Uttar Pradesh to electrify up to 50,000 villages as against 20,000 currently. I do not think funds will be a problem," Mr Shahi said. The State accounts for a massive 40 per cent of the country's rural electricity target with as many as 40,000 villages yet to be electrified.

The Uttar Pradesh Chief Secretary, Mr V.K. Dewan, said at the ongoing rate, rural electrification would take as many as 25 years but the State's new policy envisages the task to be completed in another five years.

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