After 11 years, Rs 100-bn Udangudi power project finally set to take off

To be funded by Rural Electrification Corporation, the project will be executed by BHEL in 42 months

After being delayed for nearly 11 years, work on the Udangudi Super Critical Thermal Power Project is set to begin. The estimated Rs 100-billion project, to be funded by Rural Electrification Corporation (REC), will be executed by Bharat Heavy Electricals Limited (BHEL) in 42 months.

BHEL and the Tamil Nadu Electricity Board (TNEB) had signed a memorandum of understanding (MoU) to develop this power project in 2007, when the Dravida Munnetra Kazhagam (DMK) was in power in the state. The foundation stone for the project was laid in 2009, but it did not take off and the state blamed the Centre for not allocating coal.

Amid no progress in work on the project, the next government, under the All India Anna Dravida Munnetra Kazhagam’s (AIADMK’s) J Jayalalithaa, in 2012 scrapped the MoU with BHEL and said the project would be undertaken by the state power utility.

On March 13, 2015, the Tamil Nadu Generation and Distribution Corporation (Tangedco) said it had decided to scrap the two bids received for the Udangudi power project and the matter subsequently went to the court.

All these legal battles and protests later, the project is now finally set to kick-start, with Tamil Nadu Chief Minister Edappadi K Palaniswami on Monday laying the foundation stone for Phase-I of the project.

REC Ltd has agreed to support the project, with a financial assistance of Rs 104.53 billion to set up the 1,320-Mw Udangudi stage-1 power project.

The 2 x 660 Mw coal-based supercritical thermal power project is set to come up in Thoothukudi district of southern Tamil Nadu.

BHEL has won an engineering, procurement, and construction (EPC) contract worth Rs 73 billion in an international competition bidding for installing Supercritical Thermal Power Project (TPP).

Government sources said the project would spur industrial growth in Thoothukudi since investors accorded priority to the availability of electricity and water. Since land and labour were available in good measure in the district, it had a good scope of becoming an industrial hub, they said.

In recent times, Tamil Nadu has made a big turnaround in the field of power generation – from being energy-deficient five years ago to a surplus stage in the past two-three years.

The state had been ranked first by the Central Electricity Authority for having 11,640 million units of surplus power – more than in other top producers like Maharashtra, Madhya Pradesh and Delhi. State Electricity Minister P Thangamani claimed that the state had completed 100% electrification of its villages.