NTPC to take over mgmt of Railways' plant in Bihar

Indian Railways has agreed to hand over the management control of the 1,000 Mw coal-based captive power plant at Nabinagar in Bihar to National Thermal Power Corporation (NTPC).

The power project will be a 51:49 joint venture between the Indian Railways and the NTPC at a cost of Rs 4,500 crore.

"We have proposed that NTPC take over the management provided the railways is consulted before any major policy decision is taken," a railway ministry official said.

He added that the two parties would sign the revised memorandum of understanding (MoU) after they received the railway minister's approval. The project proposal would then be sent for clearance to the Cabinet committee on economic affairs.

The NTPC, in turn, has agreed to transmit power to eight states - Jharkahand, West Bengal, Orissa, Chattisgarh, Madhya Pradesh, Maharashtra, Gujarat and Bihar "" for the operation of railway lines on electric traction.

The earlier MoU was signed in January 2002 for exploring the possibility for setting up of a joint venture captive power plant. But it left many issues unresolved. While the NTPC had staked the claim for the management control, it had also insisted that the responsibility of transmitting power to load centres in various states be given to railways.

Railways, on the other hand, had said being a majority stakeholder, it should have the management control, while power transmission should be done by the NTPC, railway ministry officials said.

Sources said the power and railway ministries were still working on various regulatory provisions needed for wheeling power within states.

With the deadlock between the two ministries being resolved, decks have been cleared for the project that has been hanging fire since 2003.

In February 2003, the project committee comprising three officials each from railway and power ministries decided to set up the power plant at Nabinagar in Bihar, after examining four sites in different states. It was decided to name the joint venture as the Bhartiya Rail Bijlee Company.

It was also proposed that the power from this plant would be used for traction purpose in states situated in the Western and Eastern Power Grid. Next year, in 2004, approvals from the public investment board and ministry of environment and forests were also obtained.