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Calcutta, Nov. 3: CESC has sought the Bengal government’s nod for a third unit of 250 MW at its Budge Budge power plant to ramp up its generation capacity.
The Goenkas will not revive the Balagarh Power Company at present where CESC had made an advance of Rs 70.37 crore. Balagarh had been lying dormant for the past couple of years.
Sources said, “Budge Budge already has an infrastructure to generate power at a competitive cost for consumers. If the company sets up a greenfield power plant at Balagarh, the power tariff will be higher. Therefore, Budge Budge is a better option.”
The two units of Budge Budge power plant currently generate 250 MW of power each. The other stations of the company are Southern Generating Station (135 MW), Titagarh (240 MW) and New Cossipore (130 MW).
The RPG-controlled power utility has closed down its 60-year old Mulajore generating station (60 MW) and has declared a voluntary retirement scheme to increase the productivity of the company.
The company has to augment its capacity following the closure of Mulajore and lowering of imports from West Bengal State Electricity Board.
The third unit, which will be set up at a cost of Rs 1,000 crore, will be funded through loans, internal accruals and proceeds from the sale of non-performing assets.
Sources said the company had already initiated talks with ICICI Bank.
The debt restructuring of the company is currently being worked out by the banks and financial institutions. The company is saddled with a debt burden of Rs 3,300 crore.
The company came out of the red after five years in 2003-04 after a recast of the accounts.
The company has posted a net profit of Rs 23 crore on a total income of Rs 674 crore in the second quarter of the current financial year. It had clocked a net profit of Rs 15 crore in the first quarter. The total income of the company in the second quarter of 2002-03 stood at Rs 608 crore.
In the first six months, the total income improved from Rs 1171 crore in 2002-03 to Rs 1327 crore in 2003-04.
CESC had suffered a net loss of Rs 12 crore in the first quarter and a loss of Rs 35 crore in the first half of 2002-03.