Power Grid Corporation of India (PGCIL), the state-owned power transmission company, is planning a capex of Rs 85,000 crore to Rs 1 lakh crore for the 12th Five-Year Plan (2012-17). The Navratna PSU is also eyeing a follow-on public offer (FPO) for the proposed expansion. Already, the corporation has become the single-largest borrower from the World Bank. So far, it has drawn $5 billion from the Bank. PGCIL's CMD S K Chaturvedi, who was in Chennai to launch the country's largest tower testing facility set up by Larsen & Toubro, spoke to T E Narasimhan about the company's plans. Edited excerpts:
Can you take us through the recent infrastructure created by PGCIL?
In the last two decades, we have created 72,000 circuit km of transmission lines and added 125 substations. This completes the National Grid, except for the southern portion. During the 12th Five Year Plan, we are planning to add another 60,000 circuit km and 50 substations.
You had said PGCIL’s capex for the 11th plan (2007-12) was Rs 55,000 crore. How much has been spent so far and how was it funded?
In the first two years, we spent Rs 15,000 crore, which was more than our target. We will spend another Rs 11,500 crore this year. Fund sources include loans from international financial institutions, such as the World Bank and ADB, and from bonds. Apart from this, we also used internal sources and mobilised funds from the domestic markets.
One of our main sources was the World Bank. So far, the corporation has borrowed $5 billion from the Bank, which made us its biggest borrower. The Bank recently sanctioned a loan of $1.5 billion.
Of the total budget of Rs 55,000 crore, 76 per cent has been secured and the rest will be raised, as and when required. We are also considering a follow-on public offer (FPO).
When do you plan to have the FPO and how much are you planning to raise? Any possibility of an IPO?
The government will decide on the IPO (initial public offer), and how much money should be raised, by March next year.
What are your capex plans for the 12th Plan? How will it be funded?
The corporation is planning for a capex of Rs 85,000 crore and we will look at three traditional models — loans, internal accruals and fund-raising from the domestic market.
Does the country have sufficient transmission lines to cater to the demand? What is the loss percentage currently?
We have created enough capacity to address upcoming projects, for which applications have come to the corporation.
Their is a misconception that power losses are due to transmission lines. It is not so. The loss is mainly due to distribution. Currently, the transmission loss is around 2-3 per cent, which is of international standards.
Can you tell us about the upcoming projects you mentioned?
For any new power project, the corporation has to issue one of the main certificates — stating that it can give open access. So far, the corporation has received applications for this certificate from private companies wanting to set up projects with a combined capacity of 17.8 million Megawatt.
I expect at least 40-45 per cent of these projects will succeed and, by 2012-13, projects with a total capacity of 55,000 Mw will start. By the end of 12th Plan, they will start generation. A majority of the proposals are coal and hydro projects.
