Power minister Sushilkumar Shinde today said awarding multiple ultra mega power projects (UMPPs) to a single company was a cause for concern as it could lead to execution delays.
The government has so far awarded four 4,000 Mw UMPPs — three to Reliance Power and one to Tata Power.
UMPPs are the centre-piece of the government's attempts to add over 50,000 Mw of power generation capacity which will come up through competitive bidding by private power developers. Much of this is expected to be commissioned over the 12th Plan, starting 2012.
“We do not have a problem even if one company gets 10 projects. But it’s a concern whether the company can execute them," Shinde told reporters, soon after taking charge as the minister.
Shinde said one company getting multiple orders could not be prevented under the law, but the government had been working on it.
Asked about the minister's statement, a senior Reliance Power executives said the Sasan and Krishnapatnam projects were on track and the company was confident of commissioning ahead of the schedule mentioned in the bid documents. They declined to comment on the Tilaiya project, which had not been handed over to the company yet.
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The ministry had earlier hinted that the government was looking to impose a cap on the number of UMPP contracts a company can win. Soon after Reliance Power bagged the Tilaiya project in January this year, former Minister of State for Power Jairam Ramesh had said the government needed to give a thought to the desirability and the feasibility of limiting the number of UMPPs per company.
Earlier this year, Reliance Power had emerged as the lowest bidder (at Rs 1.77 per unit) for the 4,000 Mw Tilaiya Ultra Mega Power Project (UMPP) in Jharkhand. The company was awarded the Sasan and Krishnapatnam projects earlier.
On his other agenda, Shinde said he was confident the country would be able to add 100,000 Mw of new power generation capacity over the five-year plan period ending March 2012.
"We had a planned target of 78,000 Mw. But we found out from other sources that it will come to 100,000 Mw because we hadn't added captive and non-conventional sources," Shinde said.
India plans to add 78.7 gigawatts of generation capacity during the five-year plan period ending March 2012, but in the first two years it has met just 46 per cent of its planned capacity addition target of 27.4 GW.
"The first two years have been slow. I am sure the next three will be very fast years of growth," he added.
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