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R-Power's Butibori project to begin soon

April 24, 2008 12:35 IST

The 300 mw Group Captive Power Project (GCPP) being set up by Vidarbha Industries Power (VIPL), a special purpose vehicle (SPV) formed by Reliance Power, at Butibori near Nagpur in Maharashtra, will soon enter the construction phase.

Sources said the required land has been acquired and the Maharashtra Pollution Control Board (MPCB) has given the green signal for setting up the project.

Reliance Power will soon award the engineering, procurement and construction (EPC) contract for the Rs 1500 crore (Rs 15 billion) project. The project is expected to take off by 2010, said sources.

The Butibori project is one of the first major power projects being set up in India under the GCPP concept. Power produced from the plant will be mainly supplied to the industrial consumers in Maharashtra at subsidised tariffs.

The project was awarded to Reliance Power by Maharashtra Industrial Development Corporation (MIDC), a nodal development agency of the Maharashtra government, through a competitive international bidding process.

The project will be beneficial to the consumers and developers alike. Industrial consumers will get discounted tariff up to 25 paise a unit and developers will garner better returns as the tariff will be higher than long-term power purchase agreements (PPA), said sources.

Reliance Power has ensured coal linkage for the project from Western Coalfields. Maharashtra Industrial Development Corporation (MIDC) has allotted the land and committed adequate water from the Wadgaon dam near Nagpur.

Other statutory approvals and environmental clearances are expected soon, said sources. Reliance Power is setting up 13 power projects with a combined capacity of 28,200 mw. This includes two ultra mega power projects of 4000 mw capacity at Sasan and Krishnapatinam.

P B Jayakumar in Mumbai
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