The Hindu Business Line : 22 cos line up for Girye ultra mega power project

ULTRA BOOST: Mr Sushil Kumar Shinde, Union Minister for Power; Mr R.V. Shahi, Secretary, Ministry of Power (left); and Dr V.K. Garg, CMD, Power Finance Corporation Ltd, at a conference in Mumbai on Monday. — Paul Noronha

Mumbai , April 17

The 4,000-MW ultra mega power project, coming up at Girye in Maharashtra, has attracted the attention of 22 Indian and overseas power companies.

They have submitted their expressions of interest to the Union Power Ministry. The total size of the project is Rs 15,000 crore and equity participation of the developers' company would be to the tune of Rs 4,000 crore. Given the mammoth size of the project, power companies are likely to form consortium and jointly bid for the projects.

NTPC Ltd, Reliance Energy Ltd, Aditya Birla Power Company Ltd, Ashok Leyland Ltd and Videocon Industries Ltd are some of the Indian companies that have shown interest in the project. Energy Infrastructure Group of Sweden and Itochu Corporation of Japan are the international companies that have expressed interest.

There are five ultra mega projects with over 4000 MW capacity planned in Maharashtra, Madhya Pradesh, Chhattisgarh, Gujarat and Karnataka. Orissa and Andhra Pradesh have also shown interest in the projects but are yet to firm up plans.

The Girye project would be located in the Sindhudurg district of Maharashtra and imported coal would be the fuel. The State Government has earmarked about 3,500 acres for the project.

Addressing newspersons on the occasion of bidders' conference for Girye project on Monday, the Union Power Minister, Mr Sushi Kumar Shinde, said that in order to facilitate the setting up of the project for the final bidders, five shell companies had been set up to address issues such as fuel, water, environment and forest clearance. The five companies were subsidiaries of Power Finance Corporation of India.

Mr R.V. Shahi, Union Power Secretary, said that the old practice of giving Government guarantees and counter guarantees for power projects had become outdated. "The new mantra for such projects is competitive bidding process and payment security mechanism for the developers, whereby the project developers get irreversible letter of credit and first right over the revenue generated by such projects, using the escrow mechanism," he said.

"The efficacy of this new system can be gauged from the fact that in last four years, there has been no default in payments to the all the major sector public power companies," Mr Shahi said.

Mr Shahi also said that coal that would be imported for the project would have to be washed at the local site before being dispatched to the plant.

The contract for the project would be finally awarded by June 30, 2007.

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