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Tamil Nadu govt to take up power evacuation projects worth around Rs 6,000 cr

According to reports, in a move to support the wind energy sector, Tamil Nadu government will take up power evacuation projects, at a total cost of Rs 5,998 crore.

The sector has been crying about the poor evacuation infrastructure in the state, which has resulted in diversion of investment to states like Gujarat, Andhra Pradesh and others.

Meanwhile, the Tamil Nadu Chief Minister J Jayalalithaa has asked for Prime Minister’s intervention to release Rs 1,500 crore from the National Clean Energy Fund (NCEF) to the State to support these projects.

Tamil Nadu currently has an installed capacity of 7,145 MW in the wind sector, making it the largest in the country. The State plans to increase this capacity by a further 5,000 MW over the next five years.

Besides, the State government has also announced a solar policy, with the aim of installing 3,000 MW of solar power in the next three years.

Tamil Nadu Chief Minister J Jayalalithaa in the letter noted that the main issue which prevents the state from reaping full benefit of the installed capacity for wind energy generation is lack of adequate power evacuation infrastructure.

“This makes the installation of transmission infrastructure to evacuate the power generated very expensive,” said the Chief Minister, adding that inadequate evacuation capacity has meant that there are situations when the wind turbines have been asked to back down due to lack of transmission capacity – although wind is a clean source of energy and the generation is also very cheap.

To overcome this situation, the state government has proposed to take up wind power evacuation projects at a total cost of Rs 5,998 crore in two phases through the Tamil Nadu Transmission Corporation.

She noted that the NCEF supports such projects. It was on the basis of this that the Tamil Nadu Transmission Corporation submitted that these projects be developed in close co-ordination with the Ministry of New and Renewable Energy.

The Ministry of New & Renewable Energy, after consulting the Power Grid Corporation of India Ltd. and Central Electricity Authority, validated two of the three proposals at a total cost of Rs 3,758 crore and recommended approval of a grant of Rs 1,500 crore for these projects from the NCEF in accordance with the guidelines which limit assistance from the Fund to 40% of the project cost.

The third proposal for setting up 400 KV substations with associated transmission lines at Karaikudi and other places in the State is being executed with Tamil Nadu’s own resources.

The two validated proposals were placed before the Inter Ministerial Group (IMG) chaired by the Finance Secretary, Government of India, on May 18, 2013 for appraisal prior to sanction, said the Chief Minister.

“Despite projects relating to the creation of power evacuation infrastructure for renewables being specifically included in the scheme guidelines, the IMG has taken the stand that transmission schemes for renewable energy cannot be supported from the National Clean Energy Fund. It is distressing to find that the IMG is going against the Government of India’s guidelines to deny Tamil Nadu, which is a flagship State in harnessing clean renewable energy, the much needed support for a project,” said the Chief Minister.

While stating that she failed to see the justification for the IMG’s stand, particularly as the project has the support of the Ministry of Power, Ministry of New and Renewable Energy and of the Union Planning Commission, the Chief Minister noted the Ministry of New and Renewable Energy has written again on July 19th , 2013, to the Ministry of Finance to reconsider its stance.

On this backdrop, the Chief Minister asked for Prime Minister’s “urgent” intervention with the Ministry of Finance to ensure that the two projects in Tamil Nadu for Creation of Transmission Infrastructure for Renewable Power (Green Energy Corridor), already cleared by the Ministry of New and renewable Energy, Central Electricity Authority and recommended by the Union Planning Commission, are accorded the necessary approvals and the eligible grant of Rs 1,500 crore from the NCEF.

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