Ministry bats for LoA to thermal projects

Written by Sanjay Jog | Mumbai, Jul 30 | Updated: Aug 1 2008, 05:12am hrs
The power ministry has called upon the coal ministry for grant of Letter of Assurance (LoA) to thermal power projects which are coming up in the first two years of the 12th plan (which is in 2012-13 and 2013-14), in addition to the remaining projects of 11th plan.

A number of such projects have already been recommended by the power ministry for grant of LoA. Generally, equipment supply of any large thermal power project takes 4 years and the gestation period from planning to commissioning takes at least 5 years. In view of the projected requirement in power generation for the 12th Plan (2012-17), it is imperative that the generation projects of the 12th Plan should take off right away.

The essential requirements such as grant of coal linkage, water allocation etc. for financial closure and equipment supply have to be processed well in advance. The ministry has proposed capacity addition of 78,700 mw in 11th plan and over 80,000 mw in the 12th plan.

Informed sources told FE issuance of LoA will ensure even distribution of orders and avert bunching on equipment suppliers. In turn, this will ensure uniform commissioning of units annually during the 12th Plan. The power ministry is of the view that work on 12th Plan projects should begin now and also supply of inputs and monitoring of progress of the 11th Plan projects should be ensured.