The Rajasthan Rajya Vidyut Utpadan Nigam plans to set up a lignite-based power plant at Giral in Barmer district and has signed a memorandum of understanding (MoU) with the Rajasthan State Mineral Development Corporation.

The MoU would allow the power corporation to use the large deposits of lignite available in Barmer, Bikaner and Nagaur district. The mineral corporation will supply 1 million tonne of lignite to the power corporation for producing electricity.

The 125 mw Giral power station would be the first lignite-based power unit in the state. It is estimated to cost Rs 618 crore. It has been estimated that the cost of power from the project is expected to be Rs 2.45 per unit in the first year and would progressively be reduced in subsequent years.

The other two lignite-based power projects, which were to be set up by WestPower, a company owned by the former ruling family of Jaipur have not seen any progress. WestPower won the projects through a bidding process. WestPower was to explore lignite mines at Kapurdi and Jalipa in Barmer district and set up two power units of 250 mw each, he added.

The mining corporation has developed nearly 31 million tonnes of lignite reserves. It will be sufficient to sustain the 125 mw plant for over 30 years.

The mining corporation is also planning to develop one more lignite deposit in Soneri, 2 kms from Giral. The deposit would be used for setting up another 125 mw unit.