Govt May Allow NTPC, PFC, Others To Tap Overseas Funds
The Union government may allow National Thermal Power Corp (NTPC), PowerGrid Corp, National Hydro Power Corp (NHPC) and Power Finance Corp (PFC) to raise money abroad to fund future projects.
Union Power Minister Suresh P Prabhu said the the Union cabinet will discuss the proposal mooted by the power ministry.
He was addressing reporters after laying the foundation stone of the fourth unit (210 mw) of Mejia Thermal Power Station of Damodar Valley Corp in West Bengal. Mejia already has three more units of 210 mw each.
He said that all these companies have good balance sheets and we want to fully use them to fund our future power generation and transmission projects. He admitted that going for global depository receipts (GDRs) would be a bit difficult, as none of the companies are listed in major stock exchanges abroad. He said that they were trying to address the problem as quickly as possible.
Prabhu said a memorandum of understanding (MoU) would be signed on June 6 between the Tamil Nadu government and NTPC to set up a 500 mw thermal power unit near Chennai. This brownfield project is a new one of its kind, as NTPC is tying up with a state government for the first time.
Prabhu said the 41,000 mw could be added during the 10th Plan period to March 31, 2007. It would not be difficult to achieve the target as 70 per cent of them are at the advanced stages of implementation or would be cleared shortly, adding environmental clearances would not be a problem either, as most of them have already got necessary clearances.
Since private sector investment is not coming in the power sector, emphasis will be on developing projects with public funding. During the 10th Plan, 10 per cent investment is expected from the private sectors. However, if the ongoing power sector reform shows signs of success, private sector funds for power generation and transmission would also come.
The minister believes power sector reforms would also lead to reductions in power tariffs. He said that if we can reduce power theft, which costs the nation Rs 30,000 crore a year, the state electricity boards would also be able to come out of the red and the benefits could be passed on to the consumers.
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