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Transmission Business |
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Our second important business segment is of building transmission linkages.
We, at TEECL, recognised the growing need for power supply to fill the
demand-supply gaps. There was a reduction in power shortage from 86,001 MW in 2008-09
to 68,168 MW in 2009-10, indicating strong capacity utilisations and improvements
in power conservation. |
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TEECL, in consortium, was successful in bagging an award for the
establishment, operation and management of a 400-KV,
100-km long transmission link
connecting 24 bay sub-stations at Rohtak and Sonepat to evacuate 1,320 MW (2 x 660)
from the Jhajjar Power Plant built by China Light and Power, Hong Kong. The Haryana
government, for the first time in the country, introduced a pioneering PPP model
with viability gap funding to select bidders on a competitive basis for a concession
period of 25 years
(extendable by another five years). This is a milestone which
incorporates the best efficiencies of the public and private sectors in the interest
of consumers. This opportunity opens up prospects of forward integration, business
retrofitting and faster business growth.Of the total capital expenditure of Rs
382 cr, the government will provide a grant of Rs 94 cr while the rest has already
been funded by
IDFC. TEECL’s special purpose vehicle will generate an annual income
of Rs. 54 crore through this business for 25 years
(extendable by 10 years). |
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This emerging business segment is attractive from a number of perspectives:
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• It entails design-build-finance-operate-transfer rights, resulting in wider revenue
streams.
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• The agreement is for 25 years, so this will translate into sustainable revenues.
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• The Company stands to derive EPC revenues plus the annual business returns plus
any increase in business value,
the Company can always divest (in full or
part) should circumstances warrant.
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• Haryana was engaged as a consultant by other states wanting to replicate this
model, so by the virtue of being
successfully engaged in Haryana, we expect to extend our presence to other states as well.
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• This represents our big leap from a contractor (generally L-one) to respected
partner, a milestone.
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• If the country adds 100,000 MW of generation capacity across the next Plan period
then a corresponding capacity on
the transmission side is the minimum incremental opportunity that we intend to address.
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