Two power plant projects stare at premature death

By Express News Service

ROURKELA: With the UN Climate Talks emphasising on phasing out fossil fuels, the fate of lingering proposals of a 4,000 megawatt (MW) ultra power plant project and 1,600 MW coal-fired power plant of Mahanadi Coalfields Ltd (MCL) in Sundargarh district seems to be all but sealed. 

The ultra power plant of PSU Power Finance Corporation (PFC) at Bhedabahal was planned eyeing the huge coal deposits in Sundargarh’s Hemgir block. Similarly, the MCL had initially planned for a 2,400 MW plant at Hemgir, while NTPC had decided to set up a 3,200 MW super thermal power plant at Darlipali around 10 to 13 years back. 

While the plants of PFC and MCL continue to be a non-starter, the Darlipali one started commercial operations with a combined capacity of 1,600 MW at an investment of about Rs 12,000 crore and a life expectancy of 25 years.  

Reliable sources said the PFC under the Ministry of Power was appointed as the nodal agency for the ultra power plant to come up on design, build, own and operate mode. Bidding in search of private partners had failed twice in 2011 and 2017. In 2014, the Odisha Infrapower Ltd (OINPL) was formed to represent Odisha and eight other power procuring states. But subsequently, most of the states stopped placing funds for allied activities of the PFC plant. Sources said the required land for the ultra power plant has been acquired and allied activities have progressed in recent years. However, heavy investment continues to be the main hurdle. 

In early 2021, Sundargarh MLA Kusum Tete had written to the Ministry of Power in this regard. In its reply, the Ministry said the ultra power plant will come up but didn’t give any time frame. But those in the know of facts said coal-fired power plants are likely to continue in India for a maximum of 15-20 years more given the increased concern over global warming. Amid this growing uncertainty, private investors are unlikely to take risk in the ultra power plant which requires at least Rs 32,000 crore.

A senior MCL officer said a subsidiary Mahanadi Basin Power Ltd was formed in 2012 to work on the revised plan for setting up a 1,600 MW joint venture plant. MCL’s core business is coal mining and since it lacks expertise in power generation, it needs a joint venture partner. A minimum of Rs 12,000 crore is required for the power project and there is no certainty yet over its progress, he added.

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