PFC shell firm for transmission projects

After making Power Finance Corporation the nodal agency for ultra mega power plants, the government has now mandated the state-run lending agency to form a shell company for transmission projects.

"PFC has been given a mandate in principle to set up one shell company to conduct bidding for transmission projects," official sources said.

Sources said the proposed shell company would be on the lines of the five shell companies formed by PFC for the coal-fired power generation projects that were 4,000 Mw each. Earlier this year the PFC had formed five special purpose vehicles for the bidding process and get necessary statutory clearances for the ultra mega projects, which would later be given to developers.

While in the case of ultra mega projects PFC has set up project-specific companies, for transmission there would be only one shell company for all transmission projects identified for development through competitive bidding route.

The projects the proposed company would take up may or may not relate to the transmission network of ultra mega power projects, sources said.

The power ministry and Power Grid Corporation of India, the central transmission utility, have already started preliminary work on the transmission requirement for evacuating electricity from the ultra mega projects.

The ministry has expanded the list of such projects from five to seven. These projects would be set up in MP, Gujarat, Maharashtra, Karnataka, Orissa, AP and Chhattisgarh, at an investment of Rs 15,000-20,000 crore each.