Cash-strapped TNEB Ltd has invited public sector power generator Neyveli Lignite Corporation to pick up an equity stake in its transmission subsidiary, TANTRANSCO.

Neyveli Lignite Corporation (NLC), which was once also into transmission, is willing to invest up to Rs 500 crore, the Chairman and Managing Director of the corporation, Mr A.R. Ansari, told a press conference here today.

He said this when asked if there was adequate transmission infrastructure to evacuate the power that the 50-MW wind farm of NLC would produce.

NLC is putting up the wind energy project, but several wind projects in the State are stuck because there are not enough substations to evacuate the power produced by the windmills.

In this context, Mr Ansari said that NLC itself could do the transmission. However, as transmission is the exclusive preserve of TANTRANSCO, NLC is okay partnering with the company.

The TNEB offer was made recently and NLC would respond soon, he said, without giving timeline.

TNEB, along with its generation, distribution and transmission subsidiaries, had on its books losses in excess of Rs 18,000 crore as of October 2010. Feedback Ventures, the consultants for TNEB's restructure, has suggested that tariffs to consumers be raised periodically to wipe out the accumulated losses.

Against the backdrop of its stressed finances, TNEB is loathe to creating transmission infrastructure for wind power, given the fickle nature of generation from this source.

The offer of stake to NLC is to be seen in this context — NLC, which is flush with funds and is also experienced in power transmission, could chip in and help build the infrastructure in the State.

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