Essar Energy [LSE: ESSR], the India focused integrated energy company, has announced commercial operations have now begun at the 600 MW unit 1 of its 1200MW Salaya I coal power project.

Unit 2 at Salaya I, also of 600 MW, has been synchronised with the transmission grid and is expected to begin commercial operations in the coming weeks.

The coal fired Salaya I project is located in Gujarat state and is being built at a total investment cost of $1.1 billion. Most of the power produced will be sold to the Gujarat state electricity utility, GUVNL, under a long term contract.

Naresh Nayyar, the chief executive officer of Essar Energy, said: “The commissioning of the first unit at Salaya is another major milestone for Essar Energy and we are also making good progress at our Mahan I and Vadinar phase 2 projects. These projects combined will add 2910 MW to our generating capacity and will improve our revenues and profitability.”

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