Centre to consider mega project policy

A proposal to include power projects with 150 mw and 500 mw capacities under the purview of the Central government's 'mega project policy' is to be brought before the Union Cabinet soon.

Addressing mediaperson, Union minister of state for power Jayawantiben Mehta said: "As long as the power project entails a Rs 1,000 crore investment and 25 per cent of the power generated by the plant is exported to states other than where it is set up, we are seeking to include the project under the Centre's mega policy. Under this policy, the project would benefit from exemptions on machinery imported (such as boilers and transformer)."

Mehta added that the Centre planned to add a power generation capacity of 50,000 mw under the 11th and 12th Five Year Plans.

"The feasibility report will be out by December. Also our emphasis is on gas as we feel that currently the Gas Authority of India Ltd is only exploiting around 30-35 per cent of the total gas potential."

She added that gas-based power plants were more practical as they took only four years for commissioning whereas hydro and thermal based power plants require 8-10 years to begin power generation.

She appreciated the power reforms being undertaken in states such as Maharashtra, Gujarat and Haryana which have collectively paid Rs 800 crore as incentive for having effected savings of Rs 1,600 crore in the power sector.

Rajasthan and Madhya Pradesh were also close behind on power sector reforms, Mehta added.

On states such as Bihar, which has defaulted on power payments owed to the national agencies, Mehta said the state had committed to at least pay up its current power bill outstandings in the immediate future.

"It was a matter of satisfaction for me to have pursued and approved the allocation of an amount of Rs 144.52 crore from the Accelerated Power Development and Reform Programme (APDRP) fund for the Bombay Electricity and Suburban Transport (BEST) that services the Mumbai city. Already Rs 91 crore of this amount has been spent. We are also happy that BEST is exempt from the regulations of the Electricity Act that came into force on June 10, 2003, and is able to continue utilising its profits from the power sector to finance its suburban transport system," Mehta said.

She expressed disappointment with the reluctance on the part of the state to pick up funds from the Rs 500 crore (interest-free) fund set up by the Union government for its rural electrification programme.

Under the APDRP, Rs 1,000 crore was made available in the first year, Rs 3,500 crore in the third year and for the current fiscal a whopping Rs 40,000 crore has been allocated, she said.