On completion of the two phases of the thermal power plant, it will be the biggest in the country producing 4000 mw at one location.
Laying the foundation stone, Union Power Minister Sushil Kumar Shinde said this was the first super critical project to be established by the NTPC at a cost of over Rs 15,000 crore.
The first phase will have three 800 mw units, while in the second phase two more units would come up.
The first stage spread over a 3000 acre was expected to be completed by 2015-16 at a cost of Rs 15,166 crore, he said.
Shinde said Kudgi was among the nine mega power projects taken up by the NTPC which would be completed at the end of the 12th plan.
To execute the nine projects, the Union Government had initiated bulk tendering of supply of critical machinery by power machinery makers across the globe, including Koreans, Japanese, French and British companies, he said.
These companies have come forward to set up manufacturing bases within the country which is likely to bring down the cost of machinery, the minister said.
"This initiative is likely to create jobs in the country and help execute new power projects at an affordable cost. This will also allow us access to the super critical technology, which is highly efficient, have less adverse effects on the environment and the plants will be able to produce more power using less coal", he said.
Shinde announced a package of Rs 10 crore for providing facilities in the affected villages where land had been acquired for the project. This amount includes Rs 1.5 crore for establishing ITI in Bijapur to train farmer youths in technical skills.
He further assured employment for the kin of farmers whose land had been acquired for the project.
