Essar Energy plc, the India-focused integrated energy company, has announced that it has signed a 25-year power purchase agreement (PPA) with the Bihar State Electricity Board (BSEB) for 300 MW from its 1200 MW coal fired Tori I power station, which is under construction in Jharkhand state.
The 300 MW PPA specifies that Essar Energy’s subsidiary Essar Power Jharkhand Limited (EPJL) will supply power at a levelised tariff of 3.28 rupees (about 6.6 US cents) per kWh, net of transmission costs. The PPA was secured after a competitive bidding process, with supply due to start from May 2015, said Essar Energy.
Another 25-year PPA with the Bihar State Electricity Board for the Tori I project was signed in July 2010 for 450 MW of capacity at a levelised tariff of 2.64 rupees (about 5.4 US cents) per kWh.
“This contract is at a significantly higher tariff than the previous PPA with Bihar and shows we are continuing to make progress in securing revenues from our investments in power generation in India,” said Essar Energy’s chief executive Naresh Nayyar.
Essar Energy claims to operate 1600 MW, with three power projects totalling 2910 MW due online by March 2012 to take the total to 4510 MW. Another seven power projects are under construction and will take Essar Energy’s total to 9670 MW by March 2014, said the company.
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