The short-gestation liquid fuel-based power projects promoted by Tamil Nadu Industrial Development Corporation (Tidco) will get a fresh lease of life through the `captive power plant route.
By converting these projects into captive units, Tidco hopes to get around the problem of fuel linkage as captive power plants additional fuel linkages can be availed of, over and above that already sanctioned to IPPs in the state. The problem of fuel linkages has plagued these short-gestation power projects for long.
The independent power producers (IPPs) whose fuel linkages have not been cleared are now being persuaded to rope in an industrial venture as co-promoter of the project.
Roping in the industrial (consuming) unit as part stake holder of the power project is crucial as the Electricity Act permits only the power board to purchase and distribute power even if it is generated in the private sector, top government officials said.
This is a win-win situation for all concerned and the Electricity Board is said to be pushing this proposal keenly.
For the government, the purpose of generating additional power is served. With big-ticket consumers getting their power independent of the grid, more power will be available to the Tamil Nadu Electricity Board for meeting the requirements of other sectors.
Both the IPP and the industrial unit (part stake holder) stand to gain. For the IPP, not only will the industrial consumer share in the project cost and risk, but will also represent an assured demand for the power generated. On the other hand, the user industry is assured of good quality and uninterrupted power supply.
The state government, it may be recalled, announced almost a year back the setting of 20 short-gestation liquid fuel-based power projects to meet the growing demand for power in the state.
For these short-gestation projects, the state government had taken the responsibility of ensuring fuel linkages. But with the Centre fixing a quota for each state for imported feedstock like naphtha, the state government was in a fix as only five of the 20 power plants could be assured of fuel supply.
Although many suggestions and appeals were made to the IPPs to switch to multi-fuel plants and to the Centre for increasing the states entitlement to liquid fuel, no progress was made in the matter. The latest is yet another attempt by the state government to ensure that these projects live up to the short-gestation tag that separates them from other private power projects coming up in the state.
