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Essar Energy signs PPA with Noida Power Company Ltd.

The Economic Times:  May, 2012

Kolkata: Essar Energy Plc signed a power purchase agreement (PPA) with Noida Power Company Ltd for 240 mw of contracted capacity from Essar Energy's 600MW coal-fired Tori II power station which is under construction in Jharkhand.

The binding PPA was signed by Noida Power Company Ltd with Essar Energy's subsidiary Essar Power Jharkhand Limited (EPJL) and has a 25 year duration, Essar Energy said in a statement.

The PPA was secured following a competitive bidding process, with supply of power under the terms of the PPA being due to commence from April 2014.

Under the terms of the agreement, Essar Energy will supply power at a delivered levelised tariff, including transmission costs, of Rs.4.08 per kilowatt hour (approximately 7.6 US cents per kWh), which is the highest long term tariff achieved through competitive bidding in India to date.

The agreement is the first PPA that has been signed for the Tori II project. At its 1,200 mw Tori I project, which is also under construction, Essar Energy has already signed two PPAs of 300MW and 450MW, both for 25 years, with the Bihar State Electricity Board.

Essar Energy currently has 2,200 mw of generation capacity operational, with a further 2,310 mw of capacity due to be commissioned this year at the Salaya I, Mahan I and Vadinar P2 projects. Beyond this four more power projects are due to be commissioned by March 2014, including the Tori I and Tori II projects, which will take Essar Energy's total to 6,700MW by that date.