REL to set up captive power plants at Thane & Butibori

Reliance Energy Limited has signed a Memorandum of Understanding with the Maharashtra Industrial Development Corporation to set up two group captive power plants at Butibori in Nagpur and Thane-Belapur belt near Mumbai.

Total planned investment on both plants would be around Rs 500 crore. The 165 mw plant at Thane-Belapur industrial estate will be gas based, while the 130 mw plant at Butibori will be coal-based plant. Both the plants are expected to be operational in three years.

REL will create separate special purpose vehicles for both plants to meet the requirements of the Electricity Act, 2003. REL currently operates five projects across the country with combined generation capacity of 941 mw.

However J P Chalsani, director (business development), Reliance Energy,  refused to divulge the details regarding tariffs for these plants. A press release issued by Maharashtra Industrial Development Corporation says it too is considering such plants at Tarapur, Ranjangao, Hinjewadi, Ambernath and Badlapur industrial estates.

The corporation has developed 220 industrial estates in the state and after studying the demand pattern, MIDC found out that, there is a demand for nearly 13,000 mw during peak hours and there is a shortfall of nearly 3,300 mw in these industrial areas.

So in order to retain existing industry in the state and attract new ones, MIDC decided to explore the concept of group captive power plant as proposed in the Electricity Act of 2003. Subsequently MIDC appointed Price, Waterhouse & Coopers as a consultant to study the concept of GCPPs.

After which, it was decided to implement the scheme in the first phase in state's two largest industrial estates Thane-Belapur and Butibori industrial areas. Then in response to MIDC's global tenders 17 power companies submitted their Expression of Interest letters. From these Wartsila Ltd, L&T, Tata Power, Bharat Heavy Electrical Limited and REL were pre-qualified.

However, the final bid was submitted by only L&T and REL and after evaluating the technical and financial bid the MIDC found, REL bid was most suitable.

The press release also informs that, "REL will be allotted 61 acres and 150 acres of land for its project at Thane-Belapur and Butibori industrial estates respectively". MIDC will also act as facilitator for REL to coordinate with various government agencies.