Tata Power to pursue expansion of Mundra UMPP

The company is awaiting settlement of compensatory tariff dispute at Appellate Tribunal for Electricity and Supreme Court

Tata Power on Wednesday repeated its plan to expand Mundra Ultra Mega Power Project (UMPP), by adding two more units of 800 megawatts (Mw) each. With this, the capacity of the Mundra UMPP will rise to 5,600 Mw from 4,000 Mw. The company is currently pursuing the environment clearance and other statutory clearances with the ministry of environment and forests and ministry of power.

At the 96th annual general meeting here, the Tata Group chairman Cyrus Mistry strongly defended the proposed expansion saying that it was to leverage the existing infrastructure. He, however, did not divulge further details with regard to the capex required for the Mundra UMPP expansion.

Replying to the concerns raised with regard to the viability of the operations of Mundra UMPP, Mistry said the Coastal Gujarat Power Limited (CGPL), which operates Mundra UMPP, will continue to play a major role. He informed that the company has put in place risk management system to mitigate various risks. He hoped the compensatory tariff issue will be soon settled in the Appellate Tribunal for Electricity and in the Supreme Court.

According to the company's annual report, CGPL is not able to recover the full cost of fuel through its tariff due to unforeseen changes in Indonesian law along with the tariff structure of the power purchase agreement.