Coal India’s 1600MW power plant taking positive steps towards realization

Coal India, the world’s largest coal producer, plans to take a proposal of setting up a Rs 9,000 crore power plant in Odisha to its board for approval in the next couple of months.

The 2×800 megawatt (MW) plant at the mouth of a coal field in the Mahanadi basin will mark the coal producer’s foray into the power sector.

Coal India Chairman and Managing Director S Narsing Rao said the company is looking at setting up power plants at mines from where evacuation of coal in absence of road and rail transport in these terrains, is difficult.

A power transmission line from the plant to the nearest electricity grid are easier and less costly to build.

“Right now I think one (power) plant in Mahanadi is at the approval stage. (The investment proposal for the) 1,600 MW (plant in) Odisha, I think in couple of months should be finally approved,” Rao said recently.

Coal India (CIL) arm Mahanadi Coalfields Limited will set up the 1,600 MW super critical thermal power plant in Sundargarh district of Odisha.

The project, he said, will take up to four years to begin generating electricity. “Typically a size of 800 MW normally takes 42 months for first unit and 45 months for second unit. Normally it should take four years,” he said.

Rao said the approval for the Rs 9,000-crore project from the board would take some time as it is still awaiting environmental clearances among others.

“Because environment clearance, etc, are required, it is still in the process. Its going on,” he said.

He indicated that the Maharatna firm is also exploring the possibility of setting up power plants in all those places where they produce coal but due to lack of infrastructure, the fossil fuel cannot be transported.

“There are some places where I can produce coal but not able to supply that coal to the consumers because of the infrastructure problems. So such places we are exploring the possibilities (of setting up the power plants),” he said.

Even at those sites,  first wants a power company to set up the plant and only in cases where they are unwilling, will the coal producer step in.

“…only when nobody wants to set up (power plant), then only we can set up by ourself,” he said.

MCL had earlier said it wishes to set up a 2×800 MW pit- head super critical thermal power plant in the vicinity of the Basundhara-Garjanbahal coal mines with a joint venture partner.

A Special Purpose Vehicle (SPV), namely, Mahanadi Basin Power Ltd (MBPL) has been incorporated as a wholly-owned subsidiary of MCL for setting up of the project.

MCL would have 49 per cent equity stake in the JV and the balance equity would be of the JV partner.