Chennai: With private power producers not showing an interest in the Tariff Based Competitive Bidding (TBCB) route, the Tamil Nadu Generation and Distribution Corporation has decided to change the mode of execution of the 1,600 mega watt Uppur Supercritical Thermal Power Project to Engineering Procurement Contract (EP C) under the state sector.

Tangedco has proposed to set up the 2x800 mw Uppur project with an outlay of Rs 9,600 crore in Ramanathapuram district and has identified 1,200 acres of land for the project.

The utility finances the project in the EPC mode; in the TBCB route, the expenditure is borne by the developer and the utility has to purchase power at a fixed tariff. A senior Tangedco official said that the private power developers had opposed the Design-Build-Finance-Operate-Transfer (DBFOT) model for execution of the ultra mega power projects (U MPPs) at Cheyyur and Odisha as this method sought to hand over the power plant to the respective state utility after 25 years of operation.

They wanted to adopt the Build-Operate-Own (BOO) model and the Union Power Ministry’s expert committee revised the bidding documents. As for the financial burden on debt-ridden Tangedco, the official noted that even if the project was executed via the TBCB route, the utility would have to provide a guarantee on return of equity at 14 per cent.
Besides, Tangedco has to pay for depreciation of the plant. “Under the EPC route, the plant will be an asset for the board and will be operated by Tangedco,” the official said.