M'shtra may put Rs 1500 crore in Mahagenco projects

The state government has in principle agreed to finance the power generation projects of the Maharashtra State Power Generation Company (Mahagenco) amounting to Rs 1,500 crore over the next five years.

A decision to this effect was taken during a presentation by the three state-owned power sector companies - Mahagenco, the Maharashtra State Electricity Distribution Company (Mahadiscom) and the Maharashtra State Transmission Company (Mahatransco), which have been carved out of the erstwhile Maharashtra State Electricity Board (MSEB) - to chief minister Vilasrao Deshmukh and Union agriculture minister Sharad Pawar on Monday at the Sahyadri state guest house.

Speaking to Business Standard, Deshmukh said, "The state government has agreed in principle to support Mahagenco's proposal and assist them up to the extent of Rs 300 crore every year for the next five years. I have asked the finance ministry to study the proposal in detail and put its recommendations before the cabinet."

This is besides the Rs 500 crore, which the state has already agreed to give to Mahadiscom for strengthening its distribution network, he added.

A senior official of Mahagenco, said, "We want to install 250 mw plant, one each at Paras and Parali besides this. We want to increase the capacity of the Khaparkheda plant by another 500 mw and set up a new unit based on imported coal at Bhusawal of 1000 mw capacity."

The official went on to add, "We have also asked the state government to finance these projects by way of buying additional equity in Mahagenco. Rest of the money would be raised through loans and internal accruals. All these projects are expected to cost between Rs 6,000 to 8,000 crore."

It has been learnt through reliable sources that Sharad Pawar has agreed to use his influence at the Centre to get cheap loans for the state power companies from Power Finance Corporation, Rural Electrification Corporation of India and other institutional lenders.