(Business Standard 7th Aug 2008) Sajjan Jindal-promoted JSW Energy will soon foray into the power distribution business as a part of its plan to become an integrated power company on the lines of Tata Power and Anil Ambani-promoted Reliance Infrastructure. Both the companies own power generation plants and also distribute power to retail and commercial customers.
To start with, JSW Energy will bid for power distribution in Maharashtra. "We will enter power distribution and its details are being worked out. It is too early to talk about the plans," Sajjan Jindal, head of the JSW Group and chairman, JSW Energy, told Business Standard.
Further details on investments and fund-raising plan are not known yet.
The company plans to bid for the likely privatisation of power distribution in the four regions of the state under the franchise model. According to this scheme, successful bidders would not buy existing assets of the state-owned distribution entity, but would have the management rights to run their operations. Further the franchisees are required to make additional investments to improve performance.
Maharashtra State Distribution Company (MSEDCL), the state-run power distributor, is planning to rope in private sector players in select regions, including Aurangabad, Ahmednagar, Ulhasnagar and Jalgaon, said state government sources.
Though the energy distribution and billing rights for the three divisions of the Nagpur urban circle of MSEDCL were awarded to Crompton Greaves, it is yet to take off because of a delay in finalising the terms and conditions between the company and MSEDCL. Earlier, a court case filed by consumer groups in the city delayed the privatisation. Ahmedabad-based Torrent Power is the only franchisee currently operating in the state, supplying power to 1.6 lakh customers in Bhiwandi. Reliance Infrastructure and Tata Power have distribution rights in the Mumbai region. But these companies own the distribution assets in their respective areas.
JSW Energy has identified power distribution business as a promising opportunity for the group, which will complement its power generation and transmission plans, said N K Jain, vice-chairman, JSW Energy.
JSW Energy, which yesterday formed a joint venture with the Maharashtra State Electricity Transmission Company (MahaTransco) to set up a 400-kv transmission system to evacuate power from JSW's 1,200-mw power plant coming up at Jaigad in Maharashtra, is also planning a similar joint venture with Karnataka, said Jinjdal.
JSW Energy, the first independent power producer in Karnataka, has a 260-mw gas- and coal-fired power plant in Karnataka. The company is also executing a 600-mw thermal power plant in Torangallu near Bellary in Karnataka.
The company is also setting up a 1,000-mw power plant in Junagarh, Gujarat, and another 1,000-mw, lignite-based power plant in Barmer, Rajasthan, besides the Jaigad project. The company is also planning major power projects in West Bengal, Jharkhand and Andhra Pradesh. Besides, the company has operations and maintenance contract for captive power plants of JSW Steel.
Moreover, the company is building a power equipment manufacturing unit in Chennai in a joint venture with Japanese major Toshiba.
It has also entered into tie-ups with Shanghai Electric of China and Dong Fang of Korea to supply power equipment for its upcoming power plants.
To start with, JSW Energy will bid for power distribution in Maharashtra. "We will enter power distribution and its details are being worked out. It is too early to talk about the plans," Sajjan Jindal, head of the JSW Group and chairman, JSW Energy, told Business Standard.
Further details on investments and fund-raising plan are not known yet.
The company plans to bid for the likely privatisation of power distribution in the four regions of the state under the franchise model. According to this scheme, successful bidders would not buy existing assets of the state-owned distribution entity, but would have the management rights to run their operations. Further the franchisees are required to make additional investments to improve performance.
Maharashtra State Distribution Company (MSEDCL), the state-run power distributor, is planning to rope in private sector players in select regions, including Aurangabad, Ahmednagar, Ulhasnagar and Jalgaon, said state government sources.
Though the energy distribution and billing rights for the three divisions of the Nagpur urban circle of MSEDCL were awarded to Crompton Greaves, it is yet to take off because of a delay in finalising the terms and conditions between the company and MSEDCL. Earlier, a court case filed by consumer groups in the city delayed the privatisation. Ahmedabad-based Torrent Power is the only franchisee currently operating in the state, supplying power to 1.6 lakh customers in Bhiwandi. Reliance Infrastructure and Tata Power have distribution rights in the Mumbai region. But these companies own the distribution assets in their respective areas.
JSW Energy has identified power distribution business as a promising opportunity for the group, which will complement its power generation and transmission plans, said N K Jain, vice-chairman, JSW Energy.
JSW Energy, which yesterday formed a joint venture with the Maharashtra State Electricity Transmission Company (MahaTransco) to set up a 400-kv transmission system to evacuate power from JSW's 1,200-mw power plant coming up at Jaigad in Maharashtra, is also planning a similar joint venture with Karnataka, said Jinjdal.
JSW Energy, the first independent power producer in Karnataka, has a 260-mw gas- and coal-fired power plant in Karnataka. The company is also executing a 600-mw thermal power plant in Torangallu near Bellary in Karnataka.
The company is also setting up a 1,000-mw power plant in Junagarh, Gujarat, and another 1,000-mw, lignite-based power plant in Barmer, Rajasthan, besides the Jaigad project. The company is also planning major power projects in West Bengal, Jharkhand and Andhra Pradesh. Besides, the company has operations and maintenance contract for captive power plants of JSW Steel.
Moreover, the company is building a power equipment manufacturing unit in Chennai in a joint venture with Japanese major Toshiba.
It has also entered into tie-ups with Shanghai Electric of China and Dong Fang of Korea to supply power equipment for its upcoming power plants.
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