Krishnapatnam, a coastal town in Andhra Pradesh’s Nellore district, is set to become India’s new power centre. It’ll be the only location in the country to boast of a power-generation capacity of 8,000MW.
While the Centre is already setting up a 4,000MW ultra-mega power plant in the town, the state government wants to set up another 4,000MW plant there. Private sector firms are also looking to set up power plants in the town, said a state government official.
In addition to easy access to the eponymous Krishnapatnam port, the town is also well connected by road and rail to enable the companies involved in generating power to transport fuel to their plants.
India is deficient in high-quality coal and natural gas— preferred fuel for power plants. Many power plantsin the country run on imported fuel.
“A lot of power projects will be set up at ports, making them power-generation hubs (with the plants being) run on imported coal or gas,” said Arvind Mahajan, executive director at audit firm KPMG.
“This will be the largest power-generation capacity to be set up at one place (within India),” said P. Kodandarami Reddy, adviser, electrical, Andhra Pradesh Power Development Co. Ltd.
Andhra Pradesh has a total installed capacity of 11,617.4MW, of which the state’s power-generation utility Andhra Pradesh Power Generation Corp. Ltd (APGenco) accounts for 6,760.9MW. The state plans to add 8,963MW of capacity by 2012 at a cost of around Rs35,000 crore.
Several overseas engineering, procurement and construction firms such as Hitachi, Marubeni, Alstom, Siemens, Sumitomo and Doosan have evinced interest in the two projects.
The site chosen for the state government’s project is 25km from the national highway and 6km from the port. The port itself is connected to the national highway through a two-lane road, which is being converted into a four-lane one.
The Union power ministry has already created a special purpose vehicle, Coastal Andhra Power Ltd, for the project. This plant will run on imported coal.
The state’s APGenco project to be set up at Krishnapatnam will also use coal as fuel. According to Reddy, 70% of the coal would be sourced from the domestic market and the balance imported.
In the first phase of this project, the utility plans to build capacity of 1,600MW at a cost of Rs8,432 crore.
After the first phase is completed, three additional units of 800MW each will be added. The state plans to use power from the plant for distribution largely within the state; electricity from the ultra-mega power plant will be distributed to other states as well.
KPMG’s Mahajan said the addition of capacity would help Andhra Pradesh avoida Maharashtra-like situation: the western state, one of the most industrialized in the country, is in the middle of a power crisis. “The power situation in South India is impacted due to gas shortage (in India). Due to this, Andhra Pradesh’s gas-based capacity is lying idle and despite a good record on the power distribution front, the state is under pressure from the generation side,” Mahajan added.