Reliance Power expects to make a total investment of R40,000 crore over the next five years to set up its ultra mega power plant in Tilaiya, Jharkhand, Reliance ADAG chairman Anil Ambani told shareholders at the company's AGM in Mumbai. Ambani, however, did not outline as to how the company plans to raise the funds. Power projects are typically set up with a debt to equity ratio of 75-25.
Reliance Power has also applied to the CERC to hike power tariffs at Sasan, which has the lowest levelised tariff in the country at R1.19/unit, JP Chalasani, CEO, told shareholders. For the first two years, the project will supply electricity at just 70 paise per unit, after which the price will rise 70%, according to the bid documents. The Sasan project has been allotted three coal blocks, two of which have started production. The first unit of the Sasan project was commissioned at the end of March, 2013.
RPower is seeking tariff hikes at its power plants, including at Sasan and Tilaiya, due to the dramatic slide in the rupee and higher-than-expected construction costs. At the Krishnapatnam project in Andhra Pradesh, which is based on imported coal, the company is hoping for a verdict along the lines of CERC's decision on Tata Power's and Adani Power's Mundra plants, by which it allowed it compensatory tariff.
The CERC set up a panel to decide on a tariff hike for the Mundra plants as law changes in Indonesia pushed up the cost of importing coal.