NTPC Determined to Score in Bidding for India's $7 Billion UMPPs

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Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--India's largest power utility, state-owned National Thermal Power Company (NTPC), will make a determined bid for ultra mega power projects (UMPPs) in Orissa and Tamil Nadu. Together the projects will take an investment of about $7 billion. Part of the motivation behind NTPC's bidding is that the company has missed out on previous bids for UMPPs, which generally have a capacity of about 4,000 megawatts (MW).

The Power Finance Corporation (PFC) will be calling for bids in the next few days. "This time we will bid aggressively. We have got over three decades of experience in the power sector and understand it as no one else does. This time there is clarity in the bid documents and there is a good chance we will win the UMPP bids," said NTPC chairman Roy Choudhury. All the major Indian power sector companies and consortiums are lining up to compete in the bidding for the projects.

Bankers have approached NTPC about acquiring distressed power plants. Industry estimates report that there are more than 10,000 MW of distressed valued at over $10 billion seeking buyers, as the developers have not been able to achieve financial closure due to issues such as land acquisition, environmental clearances, fuel supply and power purchases .

"We are conducting due diligence on all of them. We will buy them only if the plants have land in place and have achieved environment clearance and have fuel linkages," said Choudhury.

NTPC currently has installed generating capacity of 41,184 MW in 32 operational power plants throughout India. This represents about 29% of India's total installed capacity.

For related information see August 6, 2013 - NTPC Uses $3.1 Billion War Chet to Acquire 'Distressed' Indian Power Projects.

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