Land delays hit power capacity addition in Maharashtra

Slow progress on a slew of deals signed with companies in 2005.

A number of big projects by independent power producers (IPPs) have been delayed or stalled in Maharashtra due to delays in land acquisition, mainly due to strong opposition from villagers.

Reliance Power, Tata Power, Essar and Ispat were some companies, which signed agreements with the state government in April 2005 for total capacity addition of 12,500 Mw. However, except for JSW Energy’s 330-Mw unit (part of a 1,200-Mw project), none of these have been commissioned.

A state government official, who did not want to be named, told Business Standard these developers were assured a slew of concessions, including exemption from stamp duty and registration charges and total exemption from octroi for machinery and other equipment. The government also promised single-window clearances within 45-60 days.

The official said the government was banking on these private developers heavily to meet the rising power shortage. “Had at least one unit each of these projects been commissioned by the end of 2009 or early 2010, the state would have succeeded in reducing load shedding, which is of the order of 4,500-5,000 Mw,” he added.

A compilation by the state government revealed that after five years, Tata Power, which is setting up a 1,600-Mw imported coal-based project at Dherand and Shahapur villages in Raigad district, recently completed a joint measurement with farmers and revenue officials for 1,200 acres of land. Tata Power sources said it planned to start construction by September-October and make the plant operational by 2014.

Reliance Power, which proposed a 4,000-Mw project based on imported coal and gas at Shahapur, is in the midst of land acquisition. Ispat proposed to set up a 2,000-Mw coal-based project at Bhadravati in Vidarbha and a 1,000 Mw plant at its Dolvi steel plant site in Raigad district. According to company sources, there has not been any movement on the project for want of land. The company has not made any detailed project reports.

Essar planned a 1,000-Mw imported coal-based project in Ratnagiri district. However, a state government official told Business Standard the company had not moved an inch on the project. The official said the government did not expect further progress, as the company had not shown any desire to pursue the project. Essar sources were not available for comment.

THE POWER GAME

# Reliance Power, Tata Power, Essar and Ispat were some companies which signed agreements with the state government in April 2005.

# Except for JSW Energy, none of these have commissioned any unit.

# Tata Power sources said the company planned to start construction of the coal-based project in Raigad district by September-October and make it operational by 2014.

# Reliance Power, which proposed a 4,000-Mw project based on imported coal and gas at Shahapur, is in the midst of land acquisition.

# Ispat's projects in Vidarbha and Raigad district have not seen any movement for want of land.

GMR signed an agreement for a 1,000-Mw, imported coal-based project in Ratnagiri district. The official said the company had not seen any progress on account of problems in land acquisition “The villagers are quite aggressive on their demand that mango cultivation and the environment in general should be protected. They have been opposing land acquisition. This is the leading reason for lack of progress,” he said.

Similarly, NRI-promoted Spectrum Power planned a 500 Mw imported coal-based project, depending on availability of land. Its efforts to acquire land in Raigad, Ratnagiri and Sindhudurg districts has failed despite repeated attempts.