PowerGrid plans to go global; To line up Rs 1 lakh cr to raise capacity

State-run PowerGrid Corporation, which is a central transmission utility, intends to go global as an investor and developer of the transmission system. As a beginning, PowerGrid Corporation has proposed to form a joint venture (JV) in Bangladesh and Sri Lanka for the setting up of an associated transmission lines to tranmit power within the respective countries from the proposed power project planned by India’s largest power generator NTPC. It entails an investment of Rs 1,500 crore. PowerGrid has already written to the government of India conveying its desire to be developer and investors in laying the associated transmission lines through joint venture route in Bangladesh and Sri Lanka, where NTPC is setting up power projects. It wants to go in for 50:50 or 74:26 JV depending on the willingness of the authorities of Bangladesh Power development Board (BPDB) and Ceylon Electricity Board (CEB). NTPC is setting up two coal based power projects in Bangladesh where PowerGrid Corporation plans to lay 400 kv transmission line while in Sri Lanka where NTPC is developing 500 Mw coal based project, a 220 kv transmission line will be commissioned.

These transmission projects entail an investment of Rs 1,500 crore. This will be PowerGrid Corp's maiden initiative to become developer and investor abroad.  PowerGrid Corporation is engaged in providing consultancy services and turnkey execution of transmission projects in Afghanistan, Dubai, Bhutan, Bangladesh. Meanwhile, PowerGrid has also approached the government with a plea to allow it to set up captive power plants based on renewable energy sources in order to make its operations carbon neutral. Currently, PowerGrid Corporation draws about 200 Mw from the conventional power sources to operate their substations. If the Centre allows to set up wind or solar power projects for captive use it will pave way for operations becoming carbon neutral. The investment is expected to be about Rs 2,000 crore.

PowerGrid has also firmed up an investment plan of Rs 1 lakh crore to increase the inter regional transmission capacity to 65,000 Mw during 12th Five-Year Plan from the 28,000 Mw in 11th Plan. The company’s capex till October stood at Rs 43,001 crore against its target of Rs 55,000 crore for 11th Plan. The company would achieve the investment target of Rs 55,000 crore by end of March 2012. Against the original target of completing grid of 37,000 Mw in 11th Plan, it would be able to lay 28,000 Mw by end of March 2012. This was due to slippage of certain power projects that are now carried forward in the 12th Plan. For the current fiscal, PowerGrid has planned capex of Rs 18,000 crore of which 30% would come from internal accruals, while Rs 12,000 crore to be raised through multiple instruments. Of the Rs 12,000 crore, the company has so far raised Rs 7,000 crore comprising external commercial borrowings of Rs 2,000 crore and bonds of Rs 5,000 crore. The company has completed transmission system associated with the Mundra ultra-mega power project on September 28, which is ahead of schedule. It has submitted bids for associated transmission lines for generation projects being set up by Reliance and IL&FS.