Lord Swraj Paul-owned Caparo Group on Friday announced entry into the power generation business through a joint venture with Finland-based Wartsila at a project cost of Rs 1.15 billion ( Rs 115 crore).
The joint venture firm, in which Caparo Group holds 51 per cent stake and Wartsila 19 per cent, will set up a 26 MW gas-based environment-friendly power plant at Bawal in Haryana.
Natural gas being the cleanest of all fossil fuels helps reduce harmful emissions into the atmosphere compared to coal.
The plant will cater to the captive energy requirements of the group's joint venture with Maruti Udyog as also several other Maruti vendors like Mothersons Sumi, Asahi India, Talbros, Sankei India and Asian Paints located in the area.
All these companies also hold small stakes in the power plant, Caparo Group Managing Director and CEO Uttam Bose said.
"We need about five MW and the balance will be supplied to other units in the area for their captive consumption," he said.
He said the project implementation is progressing at a rapid pace and the plant is expected to start operations by the year end.
Wartsila India Managing Director Rakesh Sarin said that the project offers excellent prospect for scalability.
Since several other units at Bawal, on the Delhi-Jaipur Highway, have shown interest to join in, the capacity would be jacked up next year to 50 MW.
Bose said the gas-fired and environment friendly power generation plant is "our contribution (toward) corporate social responsibility".
The Rs 1,000-crore Caparo Group, promoted by UK-based Lord Paul, has established presence in India in diverse fields ranging from automobile to hospitality to financial services.