NTPC inks solar power supply pact with Madhya Pradesh

State-run National Thermal Power Corp on Thursday signed an agreement with Madhya Pradesh Power Trading Co (MP Tradeco) for supplying electricity from a 50 MW solar plant that it is building in the state.

The country's biggest electricity producer had announced earlier this month that the solar plant it is planning in the state would be the biggest in the country. NTPC proposes to start feeding the state grid by 2013. Power from the solar plant would be bundled with unallocated supplies from NTPC's upcoming coal-fired plants to make it affordable.

NTPC has plans to achieve a capacity to generate 500 MW from renewable sources in the next five years. It has formed a joint venture with the Asian Development Bank (ADB) and Japan's Kyuden International Corporation (Kyushu) for this purpose.

NTPC announced the solar power deal on a day the government asked all central public sector companies to set up renewable energy projects or voluntarily procure energy credits as part of efforts to boost sustainable development. (See: NTPC to set up 50MW solar plant in MP).

The ministry of heavy industries and public enterprises has asked all such entities to set up renewable energy projects or voluntarily purchase renewable energy certificates (RECs), usually each of which is equal to one MW of power.

NTPC Ltd also announced an investment of Rs18,346 crore for two projects in Karnataka and Madhya Pradesh.

The company's board has approved the investment and the two projects will have a total of 2,900 MW electricity generation capacity, it said in a regulatory filing.

The proposal includes a new project of 2,400-MW capacity to be set up at Kudgi in Karnataka, at an estimated cost of Rs15,166 crore, and a 500-MW expansion project at Vindhyachal, Madhya Pradesh, slated to cost Rs3,180 crore.

Both projects are subject to environment clearance, the company said.