Infra ropes in 3 suppliers to power Mumbai suburbs

Anil Ambani-led Reliance Infrastructure, which supplies power to Mumbai suburbs, will buy electricity from three generation companies for the next three years, a source said. The company has accepted medium-term bids of Abhijeet Group, KSK-Wardha Power Company Ltd and Vidarbha Industries Power Ltd to power Mumbai suburbs for the next three years, the source close to the development told The company has already signed power purchase agreements (PPAs) with two players for medium-term power supply and in the process of signing it with the third one, the source said.

Nagpur-based Abhijeet group will supply 55 MW power for three years starting from April 1, 2011, at a rate of Rs 4.80 per unit while KSK-Wardha Power Company Ltd, a special purpose vehicle of Hyderabad-based KSK Energy, will supply 260 MW power for three years at Rs 4.85 per unit.

Vidarbha Industries Power Ltd, a subsidiary of Reliance Power, will supply 135 MW power for two years, starting from 2012 April, at a rate of Rs 4.85 per unit, the source said.

As per the medium-term contracts, the power supply will start from April 1, 2011, and the company will buy 315 MW for the first year and 450 MW for the next two-years.

R-Infra had forwarded the medium-term bids to power regulator MERC for its approval earlier this year and had issued Letter of Intent (LoI- a document outlining an agreement between two or more parties before the agreement is finalized) to the selected power producers, its CEO Lalit Jalan had said in May. The long-term bids, to supply power to Mumbai for 25 years, are under process and it would take some more time to reach finalisation, the source said. "The company is negotiating with power generators who bid for long-term power supply, for better rates" the source said.

R-Infra had invited long-term bids from domestic and foreign companies to procure 1,500 MW of power to meet demand for its Mumbai distribution licence area, in July, 2009. A tender floated by the company had said it "intends to procure power on 'round the clock' basis for a period of 25-years, with power supply starting from 48-months to 60- months from the date of signing of relevant documents.

"The power supply, as per the long-term contract, will start from April 1, 2014, for next 25-years," Jalan had said recently. Reliance Infra supplies close to 1,500 MW power to around 27-lakh customers in the Mumbai suburbs.