Vedanta seeks nod to use IPP power for smelter

Vedanta Aluminium Ltd (VAL), a unit of Anil Agarwal controlled Vedanta Resources, has sought the nod of the Odisha government for using 600 Mw power from Sterlite Energy (also a Vedanta Group firm) to run its smelter at Jharsuguda.

VAL’s 1.25 million tonne per annum (mtpa) aluminium smelter set up as a sector specific Special Economic Zone (SEZ) at Jharsuguda is lying idle presently for want of power. Sterlite Energy, an independent power producer (IPP), runs 2,400 Mw (4x600 Mw) coal-fired station at Burkhamunda near Jharsuguda.

“We have set up our aluminium smelter in Jharsuguda in line with the state’s SEZ policy 2003 and are awaiting approval. We will be very pleased if approval can be granted immediately. The company also requests the government to allow use of 600 Mw power plant to run our smelter for value addition which is lying idle,” Vedanta Resources chairman Anil Agarwal wrote to Odisha Chief Minister Naveen Patnaik. Agarwal said a quick decision by the government can help start operations of the smelter resulting in generation of economic activities, huge local employment and additional revenue creation for the state.

The company had recently sought extension of SEZ benefits for its aluminium smelter project at Jharsuguda.

VAL has already invested Rs 12,000 crore on the smelter complex. The commissioning of VAL’s multi-product SEZ at Jharsuguda has been delayed considerably due to non-finalisation of the state specific SEZ policy. Due to lack of the policy, various government departments were unable to extend the SEZ benefits. Commissioning of the SEZ facility promised to boost the local economy by generating business potential worth Rs 15,000 crore every year. Direct and indirect employment opportunities for nearly 12,000 persons are set to be created.

The facility is also expected to develop local infrastructure besides boosting numerous small scale enterprises. Since the Odisha government has granted its concurrence to grant the SEZ status to the smelter plant, VAL had pointed out earlier that the state SEZ policy should be applicable to the establishment. The company had also suggested that developing and setting up of downstream industries in the area adjoining to the smelter should be made mandatory.