R-Power signs new pact for Sasan project

Anil Ambani-promoted Reliance Power (R-Power) has signed a supplementary power purchase agreement (PPA) with fourteen buyers from seven states for its upcoming 4,000-MW ultra mega power project (UMPP) in Sasan.

An agreement to this effect was signed today in New Delhi in the presence of officials from the Central Electricity Authority (CEA). The supplementary PPA comes in the wake of Reliance Power’s attempts to advance commissioning of its power projects by two years, said the company sources.

In May this year, Reliance Power had committed to the Union ministry of power and the Central Electricity Authority (CEA) to advance the commissioning schedule of Sasan by three years at a review meeting on UMPPs. The project, with captive coal mines, was earlier scheduled to be commissioned between May 2013 and April 2016, according to the earlier PPA.

According to the new schedule, commissioning of its first unit will be advanced by 16 months to December 2011 as against May 2013. The second unit will come after three months in March 2012. In total, 1,320 MW will be commissioned in the 11th Five-Year Plan itself, said sources.

Meanwhile, a senior executive of Reliance Power said the company was likely to announce financial closure for the project within a month. Reliance Power has also submitted the development plan for the pit-head mines to the ministry of coal and is awaiting the final clearance. The company is developing the mines in a strategic partnership with North American Coal Corporation (NACC).

India is planning to add 78,000 MW of power in the 11th Five-Year Plan and eight to nine UMPPs of 4000 MW each are likely to come up in different parts of the country. So far, three UMPPs in Mundra (Tata Power), Sasan and Krishnapatanam (Reliance Power) have been awarded based on competitive bidding. Efforts are also on to award the Tilaiya UMPP in Jharkhand.