The special purpose vehicles (SPVs) formed to implement the upcoming ultra mega power projects in Orissa and Tamil Nadu will not be given ownership rights on allocated coal blocks as was the case in UMPPs like Sasan and Tilaiya bid out earlier by the Centre.
Sources said these rights will instead be vested in a separate entity to be launched by states, which have been allocated electricity from these projects.
SPVs formed for Bedabahal (Orissa) and Cheyyur (Tamil Nadu) UMPPs will not hold any right on coal mines and land ownership, which will lie with power-procuring utilities.
Developer will only get the licence to mine coal and a lease on project land.
?Power procurers will form an entity that own coal blocks and project land,?said a senior official in Power Finance Corporation, the nodal agency for auctioning out UMPPs.
The power ministry has issued revised bidding guidelines for allocation of these UMPPs. The Bedabahal UMPP will be fired with coal available from allocated captive mines while the Cheyyur is based on imported coal.
That means there will be no question of the Centre allowing diversion of coal from allocated blocks for use in developer’s another project as happened in the Sasan UMPP ? a decision that drew Comptroller and Auditor General’s adverse observations, forcing the government to formulate a policy on usage of surplus coal from captive mines.
The coal ministry is yet to come out with policy. However, it is unlikely to have any bearing on UMPP bidding guidelines given the ownership right on coal lies with power buying utilities instead of with the developer, industry watchers said.
Although a meeting is scheduled on October 15 to gauge investors’ feedback on these projects, the power ministry and PFC remain confident of strong response from interested bidders. The ministry is banking on the high level of preparedness for implementing these UMPPs.
While all the regulatory clearances are already in place for these UMPPs, process for land acquisition is also underway. For example, distribution of money has already begun for acquisition of land for the Odisha UMPP.
Money for acquisition of land for Tamil Nadu is likely to be deposited with the concerned agency in a week or so, the PFC official said.