THE MINISTER OF STATE IN THE MINISTRY OF POWER ( SHRIMATI JAYAWANTI MEHTA )
(a) & (b) : The details, as per information available, in regard to foreign investors
who have recently withdrawn from power projects, are mentioned below :-
- M/s. Cogentrix Energy, Inc., who were one of the main promoters of the 1013.2
MW Mangalore power project in Karnataka, informed that with effect from
February 11, 2000, the Company has transferred their interests in the project and
the Mangalore Power Company (MPC) to China Light (Mauritius) Ltd., who are
equity partners in the MPC. No reasons were conveyed for withdrawing from the
project.
- M/s. Electricite de France (EDF), a French Power Company, who was the co-
promoter in the 1082 MW Bhadrawati Power Project, has conveyed its decision to
pull out from the project. The following reasons have been indicated for pulling
out:-
(i) Inordinate delay in getting clearance from various authorities.
(ii) A very high coal price sought by the coal supplier.
(iii) Lack of proper commitment for escrow arrangements.
- In the case of M/s Maheshwar Hydel Power Project (10x40 MW), foreign
collaborator M/s Bayernwerk Vew has decided to pull out from the project
because of non-project specific reasons. M/s Ogden Energy of U.S.A. exited
from the project due to its internal restructuring and changed business focus.
- In the case of 1070 MW Korba East Thermal power project, M/s Daewoo Power
(India) Ltd., have given termination notice to the State Government authorities on
14.8.2000 citing inability of the Madhya Pradesh Electricity Board to provide
payment security.
- In the case of 2x210 MW Bakreshwar Thermal Power Project, Units 4&5, the
Government of West Bengal have informed that M/s. Bakreshwar Power
Generation Co. Ltd., (BGCL), which is the Joint Venture Company (JVC) set up
by the West Bengal Power Development Corporation (WBPDCL), M/s. DCL and
M/s. Ogden Energy Asia pacific Ltd., for setting up the 2x210 MW Bakreshwar
TPP Unit 4 & 5, has since been wound up and M/s. Ogden Energy Asia pacific
Ltd., has exited from the JVC. M/s. BPGCL have intimated that they have no
interest in the project. WBPDCL have requested for transfer of the techno-
economic clearance accorded to the project by the Central Electricity Authority to
be transferred to them as per the decision of the Government of West Bengal.
(c) : The policy to encourage private sector investment (including foreign investments)
in the power sector was announced in 1991 and has been reviewed/modified from time to
time, with a view to streamlining the producers for speedy development of the power
projects. Some of the steps taken by the Government for simplifying and decentralizing
the procedure for clearance of private power projects and to attract more companies in the
power sector, are:
- minimizing the number of clearances required to be obtained for the purpose of
appraisal of the private power projects by the Central Electricity Authority (CEA).
- minimizing the role of the Foreign Investment Promotion Board by providing for
automatic approval for foreign equity in selected categories and enlarging the
provisions for automatic approval for such projects. Accordingly, projects for
electric generation, transmission and distribution have been permitted foreign
equity participation up to 100% on the automatic approval route without any
limit.
- delegating more powers to State Governments for environmental clearance.
- raising the capital cost limits up to which techno-economic clearance (TEC) of
CEA is not required.
- preparation of a shelf of projects to facilitate early execution and reduction of
time required for preparation
- close monitoring at various levels to expedite clearances, remove bottlenecks and
to resolve the `last mile` problems in achieving financial closure.
- the Electricity Regulatory Commissions Act, 1998 has been enacted which
enabled setting up of the Central Electricity Regulatory Commission and the State
Electricity Regulatory Commissions.
- the Electricity Laws Amendment, Act 1998 was enacted to make transmission as
a distinct activity for encouraging greater participation by the private sector.
- A policy on Hydro Power Development was initiated for accelerating the pace of
hydro power development in order to exploit the vast hydro-electric potential at
faster pace, increase the private investment, promote small and mini hydel
projects.
- The development of mega power projects at mine pit-heads, coastal location and
in regions with hydro potential both in public and private sector with transmission
facilities for evacuation of power to other regions is being encouraged. Under the
existing mega power policy, the identified mega projects have been given certain
fiscal concessions such as exemption from payment of customs duty for import of
equipment, income tax holiday etc.
