Tuticorin power project cleared, funds being tied up

By Venkatachari Jagannathan, IANS,

Chennai : The 1,000 megawatt (MW) coal-based Tuticorin power plant in Tamil Nadu has been cleared, according to a top official associated with the Rs.49-billion project.

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Funds for the project, being jointly promoted by the centre-owned Neyveli Lignite Corp Ltd (NLC) and the Tamil Nadu Electricity Board (TNEB), are currently being tied up, NLC director (power) V. Sethuraman told IANS.

“Funds for the project are in the process of being tied up. The project will be funded by a mix of 70 percent debt and 30 percent equity. Discussions are on with the state government’s Power Finance Corp and a consortium of banks,” Sethuraman said.

Sixty percent of the project cost would be accounted for by the boiler, turbine and generator (BTG), and the balance by other equipment and activities – technically called the balance of plant (BOP).

Sethuraman said tenders for BOP are being processed, while two companies, India’s Bharat Heavy Electricals Ltd (BHEL) and Italy’s Ansaldo are vying for the BTG order.

The project will start generating within 42 months from the date of awarding the BTG order.

“We are confident of reducing the time to 39 months,” Sethuraman said.

Though the Rs.36.38-billion NLC operates a thermal-based power plant with two units of 800 MW each in Tamil Nadu, the Tuticorin project poses a challenge: managing of coal logistics.

All these years, NLC has been operating a pit head power plant at Neyveli; there’s no such advantage for the Tuticorin project, which will require around 5.2 million tonnes of coal annually.

Apart from building the power plant, the project involves building of port handling facilities to receive the coal.

“This is a new challenge for us,” said Sethuraman. “The port is expected to involve an outlay of Rs.600 million.”

NLC is also awaiting the feasibility report for a new lignite-based power plant, also of two units of 800 MW each at Jayamkondan in Tamil Nadu, and has applied for land and lignite mining licence.

The Jayamkondan project will be a pit head plant involving open cast mining and power generation.

The 1,600 MW Jayamkondan plant’s capacity will be scaled up later, Sethuraman said.

Meanwhile, with its first 600 MW (6×50 MW and 3×100 MW) thermal station nearing the end of its economic life, NLC has decided to build a 1,000 MW plant, with two units of 500 MW each, at the same location.

The power plant underwent a renovation and modernisation programme nearly 15 years ago, and the current plant load factor is around 60 percent, necessitating replacement with higher capacity.

The work on de-commissioning the first thermal station and the setting up of new plant will start next year.

NLC will add 500 MW generation capacity this fiscal – 250 MW each at Neyveli and at its mining-and-power project at Barisingar in Rajasthan’s Bikaner district.

This would take its total capacity to 2,990 MW by the end of this year.