Bhilwara Group chairman Ravi Jhunjhunwala says the company will be able to earn carbon credits from geothermal projects

BEL has applied for licences in Ladakh and Chhattisgarh and plans to generate around 100MW of power (from geothermal projects) at an investment of Rs1,000 crore.

Geothermal energy is derived from the natural heat of the earth and has various end uses, including in electricity generation.

India has a geothermal power potential of 10,600MW, though the country is yet tosee a single commissioned project that harnesses this technology. Other benefits of geothermal projects include the fact that it needs much less land than a conventional power plant.

“Though the capital cost for generating energy through geothermal is Rs8 crore to Rs10 crore per MW, the operating cost is minimal. We are looking for developing such projects in Himachal Pradesh, Ladakh, Andaman and Nicobar islands, Chhattisgarh and Uttarakhand. We will also be applying for blocks in the remaining states," said Ravi Jhunjhunwala, chairman, LNJ Bhilwara Group. “These projects will also entitle us to earn carbon credits," added Jhunjhunwala.

LNJ Bhilwara Group already has a venture with Iceland’s Glitnir, an investment bank, to collaborate in developing geothermal power plants in India and Nepal.

“India is a very exciting market for Glitnir especially in the energy field given the projected growth of energy demand. India needs all sources ofenergy especially renewable and green sources of energy like geothermal," ÁrniMagnusson, managing director of sustainable energy in Glitnir, had said in an earlierstatement.

BEL plans to utilize its association with Glitnir, with the latter bringing in its expertise in the geothermal energy business and the financial structuring of such projects. The LNJ Bhilwara Group will be the local developer and manager of the project.

“Geothermal energy has a good future in the country. It will, however, not compete with oil or gas. Even (the) world over it is being viewed as a viable energy alternative," said D. Chandrasekharam, professor, department of earth sciences at the Indian Institute of Technology Bombay.

Bhilwara Energy is the LNJ Bhilwara Group’s holding company for all its powerbusinesses, which includes majority stakes in MalanaPower Co. Ltd and AD Hydro Power Ltd. LNJ Bhilwara Group also has hydel power projects with a combinedcapacity of 1,350MW and is poised to add another 1,500MW.

The Bhilwara Group had revenues of Rs2,857 crore and a net profit of Rs134 crore in 2006-07. Its power business contributed Rs200 crore to revenues and Rs63 crore to net profits .