Special Correspondent

KPCL and BHEL will sign an agreement on January 12 in New Delhi

MoU to be signed on Kudigi project

270 MW hydro-electric project planned

at Shivanasamudra

BANGALORE: The State and Bharat Heavy Electricals Limited (BHEL) will execute three thermal power projects of 660 MW each on joint venture at Edlapur and Yermarus in Raichur district.

The Karnataka Power Corporation Limited (KPCL) and BHEL would sign an agreement for the joint venture project on January 12 in New Delhi. The Government and the National Thermal Power Corporation (NTPC) will also sign a memorandum of understanding on January 12 to execute a 4,000 MW thermal power project at Kudigi in Bijapur district.

Both agreements would be signed in the presence of Union Minister for Power Sushil Kumar Shinde. Addressing presspersons here on Monday, Minister for Energy K.S. Eshwarappa said KPCL and BHEL would execute a 660 MW project at Edlapur and two units of 660 MW each at Yermarus. The boards of BHEL and KPCL had approved the projects.

Special Purpose Vehicle

KPCL was permitted to incorporate the joint venture company with BHEL for acting as a Special Purpose Vehicle (SPV) and to incur the expenditure to develop power projects.

A nominee of KPCL would be the managing director of SPV formed for implementation of projects. Boilers, turbines and generators which would be supplied by BHEL should be benchmarked against international competitive price, he said.

Though these projects were proposed to be developed in the 12th Five Year Plan, the Government had decided to execute them in the 11th Five Year Plan (2007-11) itself, Principal Secretary, Energy, K. Jairaj said.

The Energy Department had consulted the Finance Department and the latter had agreed to the proposal on establishment of power projects. Under the terms of conditions, BHEL will have the right to supply its manufactured transformers while civil and other mechanical works would be tendered out.

Exit option

As per BHEL policy, the company proposes to have an exit option after five years from the date of agreement or commissioning whichever is later, with the right of refusal being given to the joint venture partner.

The Government and NTPC will also sign a MoU on January 12 to execute a 4,000 MW thermal power project at Kudigi in Bijapur district.

Mr. Jairaj said the NTPC would commence work on setting up five generating units with a capacity of 800 MW each.

It is the first NTPC’s power generation project in the State.

The water requirement to the project would be met from the Alamatti reservoir.

Of the 4,000 MW, the Government had been negotiating with the NTPC to obtain 3,000 MW to the State. If everything goes well, the first unit of the mega power project would become operational in September 2009, the Principal Secretary said.

Mr. Eshwarappa said the Government would set up a 270 MW hydro-electric project at a cost of Rs. 600 crore at Shivanasamudra.

The proposal would be placed at the next Cabinet meeting.

It was also proposed to establish a 200 MW hydel project at Gundya in Sakleshpur taluk of Hassan district. Environmentalists had been opposing the project on account of its likely impact on Western Ghats, the Minister said.