Bangalore: GMR Infrastructure Ltd, the south-based firm with interests in power, construction and operating airports, said it would move a 220MW barge-mounted power plant owned by its energy unit in Karnataka to neighbouring Andhra Pradesh, after the state power utility declined to renew a power purchase agreement (PPA) citing high energy costs.
Karnataka Power Transmission Corp. Ltd, or KPTCL, declined to renew the PPA of seven years, saying the differential cost of electricity from GMR Energy Ltd, which runs the plant, was to be Rs10.59 per unit, nearly five times it pays for power from other companies.
The fixed cost of electricity from GMR Energy was Rs1.91 per unit, but had linked the differential cost to the price of fuel.
The plant near Tanir Bhavi, a village on the outskirts of Mangalore, generates power from Naptha, a petroleum byproduct.
“It is unviable. We can’t buy power at this cost,” said an executive of Power Corp. of Karnataka Ltd or PCKL, a subsidiary of KPTCL, that works with private power generators.
KPTCL and its subsidiaries pay an average Rs2.80 per unit to purchase power from other firms, said the executive, who did not want to be named.
The PPA expires on 7 June, said GMR in a notice to the Bombay Stock Exchange. It expects the power plant to be operational by April 2009, using gas as fuel, after it is relocated to Kakinada in Andhra Pradesh.
Sebi allows short-selling by mutual funds
Mumbai: Capital markets regulator Securities and Exchange Board of India, or Sebi, on Friday signed off on allowing existing mutual fund schemes to short sell, and lend and borrow securities.
Short-selling is the practice of borrowing a security from a broker and selling it with the understanding that it will be bought back and returned to the broker. Investors use this to profit from the falling price of a stock.
Retail and institutional investors are already allowed to short sell.
Mutual fund companies engaging in short selling have to disclose the risks involved in their scheme information document, Sebi said in a circular. Khushboo Narayan
ITC wins social responsibility award
Mumbai: ITC Ltd, India’s largest cigarette company, said it has won the Teri corporate award for social responsibility for its water conservation and resource programmes for agriculture, livestock and rural communities in seven states.
ITC said its projects cover more than 35,000ha with over 2,000 water-harvesting structures. Staff Writer