The Tamil Nadu Electricity Board (TNEB) has decided to break its ties with public-sector company Bharat Heavy Electricals Ltd (BHEL) for implement the Rs 8,000 crore Udangudi Power Project in Tamil Nadu. The state government alleged that the project was delayed for four years and one of the main reasons was BHEL.
In a statement Tamil Nadu Chief Minister J Jayalalithaa said that the project has been delaying since the Union Environment Ministry was not giving its nod stating that long term coal linkage is not available for the project and the other reason is BHEL was not cooperating, expect that it allocated its share of Rs 32.5 crore towards its stake in the project.
It may be noted that in 2007, the TNEB had inked an MoU with BHEL to form the Udangudi Power Corporation Ltd to set up 1,600 (2x800) mega watt Super Critical Thermal Power Project at Udangudi, Tuticorin.
As per the MoU, TNEB and BHEL will hold 26 per cent each in the company while the remaining 48 per cent will be held by the private partner and a financial institution which are supporting the project.
However, till May 2011, none of the private player had picked up the stake, said the chief minister.
“Due to the said reasons, the project was delayed by four years and it was TNEB will go ahead with the project on its own,” said the chief minister.
She added, the project will also get mega power status since it will be implemented by TNEB on its own and it will also get tax incentives, which will bring down the project cost. The other major benefit would be the state will get 1,600 Mw of power.
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The Chief Minister also said, since the Union Coal Ministry was not allocating coal for the project, it was decided to import coal for the project.
The project will be taken up the TNEB and the state government will give financial towards its shareholding in the project.