Powergrid Rules Out Long-Term Pact With National Grid

Public sector transmission company PowerGrid Corporation will not enter into any long-term arrangement with UK-based National Grid Plc for developing transmission lines. This ends speculations about the possibility of the two companies entering into a pact to develop and promote transmission business both in India and abroad.

Speaking to the Business Standard, PowerGrid chairman and managing director RP Singh said the corporation will select its joint venture partner for transmission projects only through the competitive bidding route.

National Grid chairman David Jefferies, on his visit to India late last year had discussions with the power ministry and PowerGrid on the possibilities of a long-term joint venture with the latter.

 

Such a joint venture arrangement would have required clearance from the Union government.

Singh said the corporation will invite bids from transmission companies wherever it perceives a need for funds and technical support for its projects. PowerGrid has undertaken the setting up the national grid in the country and is planning to invest around $3.5 billion during the ninth plan period for the purpose.

The national grid involves interconnecting all regions in the country through high voltage lines to ensure smooth flow of power.

The corporation has recently negotiated a World Bank loan of $1.2 billion for the ninth plan period. It also expects a cabinet approval for a change in its capital structure which would enable it to enter the market to raise resources for its transmission projects.

National Grid Plc, which is one of the largest power transmission utilities in the world, is planning huge investments in India.

It has already been selected for developing the Rs 600 crore Mangalore evacuation project.

The Mangalore evacuation project, which would be constructed on a build ,own, operate, maintain and transfer basis, involves the installation of 400 kv and 200 kv lines to connect the Cogentrix power station at Mangalore to Bangalore.

National Grid is also planning to expand its operations in Karnataka, Madhya Pradesh, Punjab and West Bengal. It is also vying for the transmission lines for the 4000 mw CEPA power project in Orissa.