18 June 2003 – Tata Power, India’s largest private sector power producer, is to develop a 1000 MW power project within its distribution area serving Delhi.
Tata recently met the state chief minister and put forward its plans to set up a project designed to meet the growing energy demands of the state, and also to correct demand-supply imbalances.
Tata Power has its distribution network in the area, and the Bawana plant is proposed to be set up within their distribution zone.
The power company will enjoy all the fiscal breaks that were announced by the finance minister in the Union Budget ’04. This is expected to make the project highly cost-effective, enabling the developers to offer power at very competitive rates. These breaks include a 100 per cent waiver on customs duty, infrastructure status and so on.
Tata Power, by virtue of the provisions of the new Electricity Act, will also have the right to use the existing infrastructure to sell its power. Thus, the company will not be required to incur additional costs to set up a new distribution network immediately, and can instead use the existing structure to pump power into the grid or distribute it.
Being a distribution licensee, Tata Power can buy power from its generation plant at Bawana under the new provisions of the Electricity Act.
The proposed plant will be solely dedicated to meet the power requirements of Delhi, which has to import more than 70 per cent of its requirement. Delhi requires both quality and reliability of power supply, and this can only be possible with the creation of additional capacity. With Tata Power’s proposed new capacity, Delhi can use the northern grid as a spinning reserve, especially during emergencies.
Tata Power currently has installed generation capacity of 2278 MW.