M. Malleswara Rao

Move aimed at avoiding placing additional burden on State’s power consumers

HYDERABAD: The government has decided in principle not to buy power from the Kayamkulam power project of the NTPC in Kerala, to avoid placing an additional burden on power consumers in the State.

As this project is operated with re-gasified liquefied natural gas (RLNG), a costly fuel which has to be imported, AP Transco would have to shell down nearly Rs 9 a unit, against Rs 4 and Rs 2 paid on an average for power purchased from private plants in the State and those of AP Genco, respectively.

High cost

The final price of Kayamkulam power will work out to Rs 12 a unit, inclusive of transmission costs. AP Transco had planned to have a capacity of 700 MW of Kayamkulam plant earmarked for the State.

The government had given an assurance to buy power from this plant on the Centre’s insistence. The State Power Coordination Committee comprising CMDs of public sector power utilities besides Energy Department officials has, instead, recommended to the government to go ahead with the construction of a 700 MW plant with RLNG as fuel, near Karimnagar (cost Rs 2,500 crore), as the first phase of the 2,100 MW project planned originally at an investment of Rs 7,500 crore. The committee opted for this course, pending allocation of natural gas to the project by the Empowered Group of Ministers (EGoM) on gas. Plans have now been finalised to complete the Phase I in two years.

“Power from Karimnagar project will also be costly but in this case, the consumers will support our own plant,” a committee member said.

The government hopes that the EGoM will allocate natural gas to the project by the time Phase I is completed, going by the EGoM guidelines to make the allocation only when the plants are ready. Barring gas allocation, all clearances have been obtained for the Karimnagar project.

Land acquired

K. Vijayanand, MD, AP Genco, told this correspondent that 432 acres of land had been acquired and 1.3 tmcft of water from the Lower Manair Dam allocated for the project. Work would start shortly to lay pipelines from Shamirpet near Hyderabad, connecting Reliance’s East-West pipeline to the project.