MP tells R-Power to sign PPA for project this month - ADAG company is negotiating with state govt about various clauses

The Madhya Pradesh government has asked Reliance Power (R-Power ) to sign the power purchase agreement for the 3,960-megawatt Chitrangi Power Project by the end of this month.State-run Madhya Pradesh Power Trading has told the company that the matter was before the states regulatory commission,which would hear the matter on July 29.As per directives of the commission,signed PPA is to be submitted before the next hearing, the state-run firm said in a letter to Reliance Power.Anil Ambani-promoted R-Power has been negotiating with the Madhya Pradesh government about various clauses of PPA such as the point of delivery of power,and both parties have been exchanging letters in this regard.Company officials say the coalfired project would be completed on schedule.R-Powers 8,000 MW of power projects at Sasan and Chitrangi are on track.The company is proceeding ahead with the implementation of its projects as per schedule, it said in a statement.The coal-fired power project at Singrauli district was allocated to the Mumbai-based conglomerate in 2007 by the Madhya Pradesh government.The state government also transferred land for the Chitrangi Power Project,following an initial agreement with R-Power.The power project required nearly 3,500 acre of land.Earlier,the state governments energy department had written to RPower,a copy of which is with ET,urging the company to execute an implementation agreement under the provisions of an MoU that was valid until March 30 this year.Kafeel Ahmed,deputy secretary in the state government,said in the letter on June 16 that the government can take action as felt necessary if the company does not respond in seven days.Industry officials said that the state government wanted to implement the project and was therefore keen to sign a PPA with the company.A senior official of the MP government said on phone from Bhopal that till July 13 the state government had not received any proposal from the company.Earlier this year,R-Power signed power purchase agreements with the Uttar Pradesh government for supply of 2,456 MW of power from Chitrangi.R-Power has been allotted three ultra mega power projects of 4,000 MW each at Sasan in Madhaya Pradesh,Krishnapatnam in Andhara Pradesh and Tilaiya in Jharkhand.