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PowerGrid plans Rs 10,000-cr capex in next 3 years

Business Standard:  June, 2012

Mumbai: State-run PowerGrid Corporation has firmed up plans to spend Rs 10,000 crore in the next three financial years on the setting up of intra-state transmission lines. For this, PowrGrid has initiated talks with Bihar, Odisha. Jharkhand, Chhatti-sgarh, Manipur, Uttar Pradesh, Madhya Pradesh, Tamil Nadu and Karnataka.

PowerGrid, which is a central transmission utility, was finalising shareholders’ agreement with Uttar Pradesh and Bihar for a 50:50 joint venture. PowerGrid Chairman and Managing Director R N Nayak told Business Standard, "The intra-state transmission projects in these states would be implemented on a 70:30 debt equity ratio. The 50:50 JV would be for 30 per cent equity, while the balance 70 per cent would be debt. The JV would carry out intra-state transmission projects, which would ultimately help smooth evacuation of power from the power projects, both in operation and those in the pipeline."

He noted, the detailed project reports for Uttar Pradesh and Bihar were being prepared.

Nayak informed that PowerGrid’s initiative was crucial, especially when during the 12th Plan period an investment of Rs 1,80,000 crore has been projected by the Planning Commission in the transmission sector. Of the Rs 1,80,000 crore, Rs 55,000 crore would be needed for intra-state transmission and the balance Rs 1,25,000 crore for inter-state transmission projects, which also include private sector investment. In the 13th Plan, Nayak said, the Planning Commission estimates to invest Rs 2,30,000 crore in the transmission sector, of which Rs 95,000 crore for intra-state and Rs 1,35,000 crore for inter-state transmission projects across the country.

Further, Nayak informed the PowerGrid plans to undertake engineering procurement and construction contracts for transmission projects in African countries and Oman. "We would bid for these projects as the PowerGrid Corporation has necessary expertise," he said.

According to Nayak, the company was engaged in carrying out consultancy assignments in Afghanistan, Bhutan, Bangladesh, UAE, Nepal, Sri Lanka and Nigeria. Besides, the company was further venturing into Myanmar, Vietnam, Ethiopia, Uzbekistan, Kenya and Tajakistan.

He said PowerGrid Corporation, which had already spent Rs 55,000 crore to set up national grid with inter-regional power transfer capacity of 28,000 Mw during the 11th Plan, proposes to invest Rs 1 lakh crore during the 12th Plan period.