NTPC Ltd on Thursday got more freedom to invest in new power projects as the government scrapped a rule that required the state-owned company to get government approval for making any equity investment exceeding the Rs 1,000 crore.
The Cabinet’s decision to lift the ceiling is intended to help NTPC, India’s biggest power producer, venture into larger projects and generate more for this electricity-starved country. It would also pave the way for NTPC to bid for overseas power projects.
The waiver is, however, subject to the implementation of a maximum of 10 power projects.
NTPC Chairman and Managing Director T. Sankaralingam welcomed the move.
"We can now go in for jont ventures for more than 1000 MW projects it will help us be more competitive and removal of cieling will pave way for the NTPC to bid for large scale projects," he said.
NTPC had ask the government to remove the ceiling of Rs 1,000 crore so that it can execute large projects for state governments either through joint ventures or wholly-owned subsidiaries.
It has submitted Request for Qualification (RFQ) documents for projects at Shahpura in Madhya Pradesh (1,500 MW), Bara in Uttar Pradesh (1980 MW) Karchana, UP (1,320 MW), Maharashtra Industrial Development Corporation, Special Economic Zone at Bhadravati (1,320 MW) and three projects in Karnataka at Chamalpura, Ghataprabha and Jeawagari, each of (1,320 MW).
In each of these seven upcoming projects the equity component is over Rs 1,500 crore.
NTPC has earmarked an investment of whopping Rs 11,776 crore or nearly $3 billion as equity in these power projects.