The Punjab government is considering a proposal to turn around all the nine ailing cooperative sugar mills in the state by inviting private players to take up co-generation from cane. The move, besides saving thousands of jobs will also save financial resources and check air pollution in a significant way.
Nine sugar mills in Ajnala, Batala, Bhogpur, Budhewal, Fazilka, Gurdaspur, Morinda, Nakodar and Nawanshahr would collectively generate 150 mw power, besides producing sugar and allied products, an official spokesman said on Tuesday.
These plants, to be operational by September 2010, will save jobs of thousands of cooperative sugar mill employees. Interestingly, the previous Congress government had ordered the closure of all the sick units.
The sugar mills in the cooperative sector have signed MoUs with various companies which will set up cogeneration power plants in these mills. The sugar mills will get a due percentage from the sale of electricity by the private party to the third party. The private parties will also provide free electricity and steam to sugar mills for their crushing operations, in lieu of bagasse and condensate water received from the mills. And, after a boot period, the cogeneration plants set up by private parties will belong to the sugar mills free of cost. He said in the case of Bhogpur, besides the electricity producing unit, the private party would also set up a sugar mill of 5,500 tonne crushing per day (TCD) capacity in place of the existing obsolete unit of 1,036 TCD. This would enhance the crushing capacity of the nine sugar mills from the present 15,766 TCD to 22,950 TCD.
With this arrangement, the government has been able to save over Rs 1,000 crore investment that would have been incurred for setting up power plants and enhancing crushing capacity. The free electricity supplied to sugar mills would also save over Rs 1 crore per annum of electricity cost that is being presently paid by mills to Punjab State Electricity Board. The government will also earn Rs 10 -12 crore as percentage of electricity sold by private players. Since private players would also maintain boilers and turbines, each mill would save anything between Rs 50 lakh to Rs 1 crore per annum.
Besides, the private companies would purchase agriculture waste, including paddy-wheat straw, through co-operative societies for generation of power. This will benefit the farmers by Rs 600 crore annually, who earlier used to burn the straw.