The Hindu Business Line : Maharashtra inks pact with 8 power cos

THE Maharashtra Government today signed agreements with eight leading power companies for new generation projects totalling 12,500 mega watts at close to Rs 50,000 crore investments, to be set up over the next five years.

Reliance Energy, Tata Power, Essar Power, GMR, CIPCO, Ispat, Jindal and Spectrum Power signed agreements for building power projects in Maharashtra, to help meet the State's growing energy demands.

They will have to sell half the power produced to any customer within Maharashtra, not necessarily to the State Electricity Board.

In return, the State will help the companies with acquiring land, water and fuel linkages and exemptions from paying stamp and octroi duties and lower tax on electricity sales.

"Under the agreements, the State Government will help investments by power producers through various incentives," Mr Vilasrao Deshmukh, Chief Minister, said at the ceremony for signing of the memoranda of understanding.

The MSEB will purchase power from these companies at a rate approved by the Electricity Regulatory Commission through competitive bidding.

The Government has not committed any `take-and-pay' to the power producers, Mr Deshmukh said.

The State Government has assured the power producers, payment guarantees for up to 2,000 MW or 50 per cent of power purchased by MSEB in the first five years.

"The Government expects the power companies to submit detailed project reports within the coming six months. It hopes that the projects will achieve financial closure in a year's time," said Mr Dilip Walse-Patil, Energy Minister.

Meanwhile, to tide over the power shortages this summer, the Maharashtra Chief Minister has asked the Union Government for 500 MW of electricity from the national grid.

Mr Desmukh told reporters that the Union Power Secretary had responded favourably to the request when the two met in New Delhi on Sunday.

Mr Deshmukh said the State currently has a shortfall of about 1,800 - 3,000 MW daily and this might go up further in coming summer months.

A committee headed by the Principal Energy Secretary, Mr B.P. Pandey, reviewed the power situation in Maharashtra and recommended new policy initiatives for setting up additional power generating capacity in the State.

The committee has suggested restructuring of the MSEB and promoting private investment in power generation in the State.

It is estimated that the State will experience a power shortage of 7,700 MW by 2010.

Offers to buy Dabhol power at Rs 2.20 a unit

THE Maharashtra Chief Minister, Mr Vilasrao Deshmukh, on Monday said the State is willing to buy entire power from the beleaguered Dabhol Power project but only if it was available at Rs 2.20 a unit.

"The Union Government is trying to revive the Dabhol power project. And, we hope a resolution is met soon. On our part, Maharashtra will buy the entire 2,184 MW that can be produced at the Dabhol project, if it is available at Rs 2.20 a unit," Mr Deshmukh said.

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