Mp Cover For 3 Coal-Based Plants

The Madhya Pradesh government yesterday selected three coal projects for escrow cover. They include Daewoo Power- promoted 1,070 mw Korba project, the Pench Power-promoted 500 mw Pench project and Birla/PowerGen-promoted 500 mw Bina power project.

The total number of projects with escrow cover has gone up to four. The state had earlier extended the cover to S Kumar-promoted 400 mw Maheshwar project.

The government has, however, taken no decision on the liquid fuel projects due to a High Court stay after one of the liquid fuel promoters (Madhya Bharat) challenged its move to re-open signed PPAs.

Sources said that after yesterdays announcement, the electricity board may not have any escrow capacity left for liquid fuel projects. This is because, at present, the total capacity of the projects with escrow cover is around 2,500 mw, while the escrow capacity the financial institutions had recommended was 2,561 mw.

Even though the state has not sent any communication to the liquid fuel promoters, the promoters feel the state will have a back-up escrow capacity of at least 300 mw.

Sources said by treating the 400 mw Maheshwar project as a peaking station, only 20 per cent of the capacity would require escrow protection, leaving 320 mw of additional escrow to be allocated to the liquid fuel projects.