Hyderabad, Oct 18th: The state-owned Singareni Collieries will set up a 600 MW power plant at a cost of Rs.2, 700 crore (Rs.27 billion) in Adilabad district in Andhra Pradesh. Chief Minister K. Rosaiah, who will shortly lay the foundation stone for the project to come up in the backward Telangana region, Sunday, said the plant was expected to be completed by December 2012. According to him, the project would not only give an impetus to the growth of Telangana, but also help the state bridge its power deficit to a large extent. Rosaiah, who met officials Sunday to review the power situation in the state, said the project would be financed through a mix of internal mobilization and debt.

The coal locked up in an abandoned mine at Srirampur would be sourced for the project, essentially a pithead power plant. The mine is expected to produce about 2.5 million tones of coal annually. Rosaiah said Singareni Collieries has acquired the required land and obtained necessary environmental clearance. The company is in the final stages of negotiations with power equipment manufacturer Bharat Heavy Electrical Ltd (BHEL) for sourcing equipment. It would also enter into a power purchase agreement (PPA) with Andhra Pradesh Transmission Corp (AP Transco) and distribution companies (Discoms). The chief minister said the government was committed to stepping up power generation because of the ever-increasing deficit. 

As part of this effort, state-owned power producer Andhra Pradesh Power Generation Co (AP Genco) is planning to foray into nuclear power and set up its first power plant in the state in collaboration with Nuclear Power Corp. Moreover, according to AP Genco chairman and managing director K. Vijayanand, the 500 MW Bhupalapalli power project would be completed by next March, as scheduled. Andhra Pradesh is in the grip of an acute power crisis following the recent floods that damaged the two power units at Srisailam dam across Krishna River. The chief minister said the 900 MW Srisailam left bank power house has since then been repaired and generation would resume this week. The 770 MW right bank power house was completely inundated Oct 3, and repair work would commence once the flood waters recede, he said.