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Damodar Valley Corporation has initiated discussions with power equipment major BHEL and Coal India Ltd to build two super critical thermal power stations as a joint venture. The report added that the company also plans to rope in the Rural Electrification Corporation or the Power Finance Corporation as equity partners in the joint venture.

Sources in Damodar Valley told that as the corporation’s IPO plan was put on the back burner, DVC was planning to add about 3000 MW generation capacity at Raghunathpur in West Bengal and Kodarma in Jharkhand in the Twelfth Plan Period through a joint venture with equipment suppliers or coal companies and domestic FIs.

The proposal includes setting up two 660 MW units in Kodarma in joint venture with CIL and two 800 MW units at Raghunathpur with BHEL. The source added that CIL’s participation may ensure smooth supply of coal at Kodarma power station, the equity participation at Raghunathpur may offer BHEL the opportunity to commercialize its indigenously developed 800 MW technology.

According to the proposal, DVC and its JV partner either BHEL or CIL will hold 26% each and a consortium of financial institutions led by either REC or PFC will be offered the residual 48%. Both REC and BHEL confirmed some early discussions in regard to the setting up of the Ragunathpur project in joint venture.

Mr P Ravi Kumar chairman of BHEL said that “We are ready to be an equity partner in Raghunathpur project with DVC.” He however added that DVC was yet to place any formal proposal in this regard.

A DVC official said that “If finalized, Raghunathpur will host the first 800 MW unit manufactured by BHEL.” He added that “Apart from sharing the financial responsibilities, we also propose to share the technological risks of setting up the 800 MW units through joint venture with the equipment supplier.”

Source - Hindu Businessline