Uncertainty over the availability of domestic as well as imported coal has forced Maharashtra State Power Generation Company (MahaGenco) to scrap two coal-based power projects of 1,980 Mw each. The state-owned company had proposed to set up these projects through a joint venture (JV) at Dondaicha in Dhule district and at Dhopawe in coastal Ratnagiri district.
However, the state government has suggested that these projects be considered under case-II bidding, according to which, the state-run power distribution company MahaVitaran will pursue the development of these projects.
Under case-II bidding, MahaVitaran, which is expected to procure power, will have to specify location, technology and fuel. Further, the procurer will also have to acquire land and undertake preliminary studies of coal mining blocks and also seek in-principle, environmental clearance for project and mining blocks as well as other statutory clearances. Further, the procurer will invite bids on the basis of capacity charges and net quoted heat rate.
The Dondaicha project envisages an investment of Rs 21,450 crore, while the Dhopawe project accounts for Rs 14,220 crore investment. MahaGenco, which has a thermal installed capacity of 6,980 Mw, is to offer 74 per cent of the projects to private sector partners.
MahaGenco had floated bids in July 2012, but the response from the private sector was poor due to lack of assured coal supply and delays in getting various clearances. However, MahaGenco recently made a detailed presentation to Maharashtra Chief Minister Prithviraj Chavan and his deputy Ajit Pawar. The decision to cancel these projects under the JV route and to pursue development of these projects under case-II was taken at the same meeting.
A MahaGenco official told Business Standard, “Coal availability both from domestic sources and imports is a major issue. MahaGenco’s own generation is impacted heavily due to lack of adequate and best-quality coal supply.”
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He added that private sector companies have raised concerns about the risks involved in the procurement of coal and its impact on their investments. “Importing coal has become quite tedious as several countries have introduced new regulations. Therefore, it has been decided to cancel Dondaicha and Dhopawe projects by resorting to the JV route,” he said.
According to the official, the state government wants MahaVitaran to pursue case-II bidding. The decision in this regard would be taken soon. MahaVitaran sources, however, said it is yet to take a call on the matter.