Kerala - Thiruvananthapuram   

KSEB signs pact with NTPC

THIRUVANANTHAPURAM: The Kerala State Electricity Board (KSEB) on Friday signed a power purchase agreement with the National Thermal Power Corporation (NTPC) for the State’s share of electricity from the proposed second stage of the latter’s mega thermal power project at Simhadri in Andhra Pradesh. The agreement was signed at a function here in the presence of Electricity Minister A.K. Balan. The KSEB’s Member (Generation) A.G. Bhadran and the NTPC’s Director (Commercial) R.S. Sharma signed the document on behalf of the respective institutions.

The NTPC will set up two units generating 500 MW of electricity each at Simhadri under the proposed second stage of its mega power project there. The project is coal-based. The first stage was fully dedicated to Andhra Pradesh, while all the Southern States will have a claim over the electricity generated under the second stage. Kerala has sought 200 MW from Simhadri, Mr. Balan told mediapersons after the agreement signing ceremony.

He said that a unit of electricity from such a project, using coal as fuel and enjoying exemption from excise duty, customs duty and income tax under the Union Government’s Mega Power Policy, would cost Kerala only about Rs.2.50 under the present circumstances. The tenure of the agreement was 25 years, he added.

Mr. Balan said there were certain conditions in the Centre’s policy about which Kerala had reservations. For instance, the policy required the States benefiting from projects set up under it to privatise the distribution of electricity in urban centres with a population of over 10 lakhs. Kerala had informed the Centre and the NTPC this would undermine the operational viability of the KSEB.

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