Ultra Mega Power Projects in India’s Power Sector

The power sector is one of India’s most significant infrastructural developments for its generation, distribution, and supply of electricity. India’s ultra mega power projects are a powerful initiative launched by the Ministry of Power, Government of India, in November 2005. The projects, each with a capacity of 4,000 MW, are developed for massive power production in India. The Ultra Mega Power Projects in India aim to bridge the gap between demand and supply to produce at least 100,000 MW of additional capacity by 2022. The projects and their development is monitored and facilitated by the Power Finance Corporation Ltd. 

What are ultra-mega power projects and their importance?

• The initial power projects were initiated in the 1990s and were named mega power projects (MPP). The ultra-mega power project of India is an expansion of the MPP, which was launched by the cooperation of Power Finance Corporation Ltd. with the Central Electricity Authority.
• The ultra-mega power projects of India were developed at Mundra, Gujarat, by Tata Power. The power plant contributes nearly 4,000MW of power to the Western Grid.
• The production of power through the power plants is through the use of supercritical technology. The technology is thermally efficient, lowers greenhouse gas emissions, and saves fuel. 
• The power ministry supports India’s ultra mega power projects and their development. The key areas required for the intervention are coal block allotment, forest clearance, and water linkage. 
• The main objective of the set up of the large scale power plants is to increase the production and supply of electricity in an energy-efficient manner. 

Need for the Special Purpose Vehicle (SPV) 

• The Power Finance Corporation sets up the SPV (Special Purpose Vehicle) for each ultra mega power project in India. The SPV is responsible for various aspects of the project like forest clearance, coal mine allocation, water linkage, etc. 
• The projects are executed with the help of two special purpose vehicle structures, including: 

1. The operating SPV comes into play first and is involved in statutory clearance, approvals, and bidding for the project. The highest bidder is transferred with the operating SPV. 
2. The infrastructure SPV involves the coal block and land allocation for setting up the power plant. Once the bidding process is over, the land is leased by infrastructure SPV to operating SPV for setting up the power plant. 

The main activities undertaken by the SPVs are:

• Appointment of consultants for preparation of project reports, rapid environment impact assessment reports, etc. 
• Consultant appointment for international competitive bidding, preparation of the necessary documents and evaluation 
• Carrying out the bidding process for ultra mega power projects of India and awarding the project to the suitable bidder
• Allocation of land for setting up of the plant, coal block allocation, and getting the clearance for water allocation by the state government 
• Getting the approval by sea-board from the maritime board and other relevant agencies around the coastal locations. Obtaining clearance from the state pollution board, coal mines and environmental clearance. 
• Obtaining the necessary geological reports or data

Current Ultra Mega Power Projects of India

The ultra-mega power projects in India are set up with the help of the Ministry of Power & Central Electricity Authority (CEA). Each of the UMPPs can generate nearly 4000 MW of power. Initially, the proposal was to set up nine power projects across different states in India.

• The first UMPP project established was in Mundra in Gujrat to Tata Power Company Ltd. It was commissioned and handed over on April 23, 2007.
• India’s Sasan ultra mega power projects in Madhya Pradesh were handed on August 7, 2007, to Reliance Power Ltd.
• The Krishnapatnam UMPP in Andhra Pradesh was handed over to Reliance Power Ltd. on January 29, 2008.
• The Tilaiya UMPP in Jharkhand was handed over to Reliance Power on August 7, 2009. However, on June 19, 2018, the agreement and ownership were transferred to Jharkhand Integrated Power Ltd (JIPL). 

Many ultra mega power projects in India are under the implementation stage. Out of all the proposed UMPPs, a few are under implementation. The Cheyyur UMPP in Tamil Nadu, Odisha UMPP in Bedabahal village, Bihar UMPP under Bihar Mega Power Ltd, and Deoghar UMPP in Jharkhand are under implementation. India’s ultra mega power projects in various planning stages include the second and third UMPP in Odisha. The second UMPP is identified at Bijoypatna in Bhadrak district, and the third UMPP is identified at Narla & Kasinga in Kalahandi district. The UMPP in Uttar Pradesh at Etah district is in the planning stage.

Conclusion 

What is an ultra mega power project? The UMPP are ambitious projects initiated by the Government of India, which is under the nodal control of Power Finance Corporation Ltd. The ultra mega power projects in India are allotted and awarded to the bidders through competitive bidding. The power projects are based on supercritical technology, which aims to develop a large-scale electricity generation in an energy-efficient manner. Supercritical technology is effective as it is thermally efficient, reduces greenhouse emissions, and saves fuel costs. The UMPP are important initiatives set up in the power sector, each generating nearly 4000 MW of electricity.