Kandla SEZ to source power from NTPC

Kandla Special Economic Zone (KASEZ), the first free-trade zone in the country, has decided to buy power from National Thermal Power Corporation (NTPC) from this year-end.

At present, KASEZ gets its power supply from Gujarat Electric Supply Board (GEB), which charges Rs 4.17 per unit "" much higher than what other SEZs pay for power in the country.

"The amount GEB is charging us is very high. Other SEZs in the country "" such as the ones in Kerala and West Bengal "" have to pay around Rs 2 to Rs 2.50 per unit for power. NTPC's power will cost us Rs 2.50 per unit. The Indore SEZ is also buying power from NTPC since two years," Yogendra Garg, development commissioner of KASEZ, said.

Currently, KASEZ has 142 working units with a maximum requirement of eight mega units during the day.

The SEZ Act stipulates that investors in a special economic zone buy power from the state power supply board or put up a power generating unit of their own. However, now with a regulatory board in each state, SEZs can approach other parties for buying power.

"Though GEB has given us a 20 per cent concession for 10 years, we feel the rate is still high compared to other SEZs," Garg said.

Though some investors in KASEZ, like Union Lever, have agreed to bear with the high power rates, some look at it as an obstacle in the path of KASEZ's growth.

B Pradeep Kumar, factory manager of Hindustan Lever Ltd, said" "GEB's rates are highest compared to what other power suppliers charge for a SEZ. The KASEZ authority's decision buy NTPC's power will be beneficial for us. As charges of NTPC are low, our production costs would also automatically be reduced. This will also help us compete with others."

Garg added, "We are planning to put up a 66 KV substation at KASEZ. We applied to the Gujarat Electric Regulatory Board (GERC) for distribution licence in September, 2004 and we hope to get the approval by this year-end."