30 March 2005 – Indian power producer Tata Power (TPC) has formed a joint venture with state-run Damodar Valley Corporation to undertake a 1000 MW power generation project.
Tata Power will hold 74 per cent stake while DVC will hold the rest 26 per cent in Maithon Power Ltd to implement the proposed 1000 MW Right Bank Thermal Power project.
The agreement is the first initiative in public-private partnership in generation, the Tata group company said, adding TPC is now the first private entity in the power sector to enter into public-private JVs in all three crucial segments of generation, transmission and distribution.
“The venture marks an initiative towards acquiring a truly national footprint and sourcing power at economic rates for the end consumer. The agreement marks a successful trend and offers hope for more such joint initiatives for the power sector in future,” TPC Managing Director F A Vandrevala said.
Tata Power had earlier formed a distribution JV with the government – the North Delhi Power Ltd. It has also formed a transmission JV – Powerlinks, with Power Grid Corporation of India for the Tala power project in Bhutan.
As per the agreement, TPC would be entitled to nominate up to seven Directors, including the Chairman and Managing Director, and DVC up to three Directors.
Prior to financial closure, DVC will also have the option to enter into a bankable power purchase agreement with TPC to purchase up to a specified quantum of power.