According to R V Shahi, chairman, BSES, the fresh investments would be made without any dilution of its present equity. Within this period, the company will also generate an additional sum of Rs 1,700 crore through internal accruals. The present debt equity of 0.6:1 would help to leverage around Rs 1,600 crore for expansions, he told Business Standard.
BSES had signed a memorandum of understanding last week with the Tamil Nadu Industrial Captive Power Company for a 250-mw, lignite-based power plant. The company will also have a majority representation on the board of the plant and would appoint the company chairman soon.
The plant would be located at Srimushnam, near Neyvelli in Tamil, Nadu. Discussions on the power purchase agreement (PPA) between BSES and the Tamil Nadu Electricity Board are in progress and a detailed project report has been submitted to the CEA for its approval. Tamil Nadu has issued notification for acquisition of 1000 acre of land for the project.
BSES is in the process of identifying an agency for lignite mining for this project. More than 3.5 million tonne lignite is required for the project annually.
BSES has also approached the Tamil Nadu State Electricity Board and the Tamil Nadu Energy Department to set up two 250-mw plants, instead of the proposed plant earlier at the same site.
Additional power generation would be through joint ventures and BSES would hold a controlling stake in all future projects. The company is also tying up with a Gujarat-based company for manufacturing bricks from fly-ash.
In Kerala, BSES has bagged three naptha-based power projects of 50 mw capacity each. The PPA has been finalised with the state electricity board and awaits the state cabinet clearance. After the financial closing of the deal in December, 1996, the project can be expected to generate power within 18 months.
According to Shahi, amongst its other expansion plans which have been finalised are its 2.5-million tonne, coal washing unit at Korba. BSES holds 35 per cent stake in the Rs 50-crore, joint venture plant at Kolba.
The US-based, Spectrum Technology will hold 35 per cent equity and CLI of the US will hold 12 per cent. The balance would be proposed to financial institutions.
BSES has entered into a separate engineering procurement and construction (EPC) contract for coal washing with CLI and will be operational within 18 months.
Coal for this project would be procured from the south eastern coal field of Coal India, situated at Korba. This is the first coal washing plant developed in the country by a utility for a power plant.
Coal supply to BSESs Dahanu plant in Maharashtra has also been normalised. Contrary to recent reports there is no shortage of coal at the Dahanu power plant. The Dahanu plant received approximately two lakh tonne of coal in October.
Considerable gains have accrued to BSES due to the cutting down of transmission and distribution lose (TDL). From 15 per cent in 1993-94, TDL have gone down to 13.9 per cent in 1994-95. The TDL has dropped to 12.6 per cent in 1995-96 and is expected to be 12 per cent soon. Each per cent saving in TDL results in a net saving of Rs 15 crore for BSES.
The TDL figure for the Calcutta Electric Company is 18 per cent with Delhi registering 40 per cent TDL in 1995-96, the highest in the nation. The national TDL average is 22 per cent. BSES also intends to toughen their stand, regarding the quality of imported coal. Any coal consignment having more than 0.5 per cent sulphur will face immediate rejection in future.
Though BSES has not received approval for an additional 500-mw plant at Dahanu, it is hopeful of getting approval within a couple of years.
