The Hindu Business Line : BHEL to invest Rs 1,600 cr for capacity expansion

The focus is on adding facilities for various products in its manufacturing units and for construction tools and equipment for erection and commissioning services at customer project sites.

New Delhi , Aug. 29

Bharat Heavy Electricals Ltd has said it would invest Rs 1,600 crore to modernise its power equipment manufacturing facilities and expand capacity.

The expansion will raise its equipment production capacity to around 10,000 MW, from 6,000 MW now, the company said in a statement on Tuesday, adding that the enhanced capacity would become available by 2007.

BHEL, the country's largest producer of energy equipment, said its plan was aimed at meeting the country's power capacity addition of more than 62,000 MW during the Eleventh Five-Year Plan period.

BHEL has large accumulated reserves and surplus in addition to its leveraging capacity to raise resources from the market and can fully meet the resource requirements on its own, the company said.

During the current Plan period (2002-2007), nearly 34,000 MW of fresh generating capacity is expected to be added of which BHEL's contribution would be about 19,500 MW, which is well within its present production capacity, the company said.

Brownfield expansion

BHEL would be more than willing to further enhance its capacity even beyond 10,000 MW to the levels required by the country's power sector, it said.

In the current expansion programme, the focus is on adding facilities for various products in its manufacturing units and for construction tools and equipment for erection and commissioning services at customer project sites. This plan is in the nature of brownfield expansion and would add mainly work-centre capacities. This approach has a strong economic rationale both in terms of time as well as cost-benefits, the company said.

Upgradation

BHEL said it has taken necessary steps for upgradation of existing technologies and introduction of new ones. It has already tied up to acquire new technology to produce thermal power equipment with super-critical parameters for the manufacture of sets of 800 MW and above.