JSW Energy, the group company of Jindal South West headed by Sajjan Jindal, will launch its initial public offer within two months to raise Rs 3,000 crore (Rs 30 billion) to fund 3,000 Mw of power projects under construction.
It aims to become a major power producer with about 11,400 Mw of generation by 2015, besides venturing into power transmission and distribution business and investments in renewables like solar energy. S S Rao, joint managing director and chief executive, and Pramod Menon, chief financial officer, spoke to PB Jayakumar and Nevin John on the plans:
What is your current installed capacity? How much do you plan to add?
Now, we have an installed capacity of 560 Mw in Karnataka. Of this, 300 Mw was commissioned in April and another 300 Mw will be synchronised to the grid by November this year. In Maharashtra, we are implementing 1,200 Mw (4x300 Mw) of a coal-based power project and 1,080 Mq (8x135 Mw) in Rajasthan, which is a pit-head lignite project.
The first of these projects will start producing power by 2010 and the rest of the units commissioned at every three-month interval. A 270 Mw second phase of the Rajasthan project is also in the implementation stage. We also have a hydro electric project of 240 Mw under implementation in Himachal Pradesh. Together, we have over 3,000 Mw under the implementation stage and 560 Mw is already operational.
In addition, we plan to develop a 3,200 (4x800) Mw power plant at Ratnagiri in Maharashtra near the upcoming 1,200 Mw and the second phase of the 2x135 MW power plant at Barmer in Rajasthan. Other projects are a 1,320 Mw coal-based thermal plant at Chhattisgarh, a 1,600 Mw domestic coal-based power plant in West Bengal and a 1,620 Mw coal-based thermal plant at Jharkhand.
Most of the second phase projects will be super-critical, with advanced technologies. Our target is to become a leading power generator with over 11,300 Mw of installed power capacity by 2015.
Have you tied up fuel linkages for these projects?
The project in Rajasthan is a pithead lignite project and for other projects, we have a coal sourcing arrangement with an Indonesian company.
Apart from this, you have joint ventures in transmission and also have invested in power equipment manufacturing. Are you planning to enter into all areas related to power?
We have entered into an agreement with the Maharashtra State Electricity Transmission Company Ltd to incorporate a joint venture company, Jaigad PowerTransco Ltd, to evacuate power from the Ratnagiri project and a transmission line has been created in Vijayanagar, Karnataka, to evacuate power from the project there.
Transmission and distribution are areas we are keenly looking at and will participate in competitive bidding of such projects.
Similarly, we have a big team for engineering, procurement and construction for power plants, now restricted to our internal projects. Our power equipment manufacturing joint venture is with Toshiba of Japan and we are setting up the unit near Chennai, with an investment of Rs 1,000 crore (Rs 10 billion).
Of which, our contribution is 20 per cent equity and another 5 per cent is from our group company, JSW Steel. We also have a mining joint venture in Rajasthan.
What are your plans in renewable energy?
We are already constructing a hydro power project in Himachal Pradesh and will participate in the bidding process for other such hydro power projects in the North and Northeast. Solar energy is another area we are looking at and we are developing a pilot 5-10 Mw solar project in Rajasthan. We will add more such projects.
So far, we have not decided to invest in the wind energy sector and other renewables like biomass.