Official sources said that a meeting with the potential beneficiary states of the northern, southern and western regions, has been scheduled for November 23 for finalising the capacities to be offered to the bidders in the first phase.

Whereas a host of mega power projects have already been identified for the private sector, SIG has decided to pick up a maximum of two to three projects to start with, instead of simultaneously proceeding with all the projects.

Sources said that the capacities to be offered in the first batch of projects will be fixed based on the state's requirement of power along with their capacity to pay for the power purchased from these mega power projects.

"The demand for power of only those states will be taken into account who have agreed to concur with theconditionalities of setting up of the state regulatory commissions, privatisation of distribution in all cities having population of more than one million and recourse to states share of central plan assistance (CPA) and other devolution.

States adhering to these conditions will be identified and will become the beneficiaries of power from the first batch of these mega power projects", sources added.

Out of the mega power projects already identified by the government, which includes the 2000 MW Pipavav and 1000 MW Narmada in Gujarat, 1500 MW Krishnapatnam in Andhra Pradesh, 1000 MW Cuddalore in Tamil Nadu, the SIG is likely to offer Pipavav and Krishnapatnam in the first batch.

However, the details will be worked only after the meeting with the states following which a list of the beneficiary states will be worked out.

In addition to this, the much touted, Power Trading Company (PTC), which will deal in the sale and purchase of power will also be put into place at the earliest. The SIG, sources said,will soon take a final view on the capital share of different agencies in the PTC.

Although it has already been decided that initially PTC will a fully government owned body with a 51 per cent stake held jointly by Power Grid, National Thermal Power Corporation (NTPC) and the Power finance Corporation (PFC), talks are still on for the balance 49 per cent which will be offloaded to various banks and financial institutions.

Unit Trust of India (UTI), Life Insurance Corporation of India (LIC), Infrastructure Development and Finance Corporation (IDFC) along with other agencies are learnt to be in the race for securing a equity share in PTC.

The ministry of power has been asked to examine the equity stakes of different agencies and also look into the issue of the amount of paid up/authorised capital of the PTC. Based on the recommendations of the power ministry, the SIG would take a final view on the matter, sources added.

It may be mentioned here that a host of leading international power companies haveevinced keen interest in taking up the development of mega power projects and have promised to deliver power at very cheap rates. The government has already announced the mega power policy under which all the developers would be given a complete waiver of customs duty for equipment imports, a 10 year tax holiday and a securitisation package.

The government is soon expected to move a note to the cabinet on the securitisation package worked out for the smooth functioning of the PTC.