Calcutta, Dec. 30 :    Calcutta, Dec. 30:  National Hydroelectric Power Corporation (NHPC) expects to begin work on the 900 MW Purulia Pumped Storage Project by January-end. The project will cater not only to West Bengal, but the entire eastern regional grid. Speaking to The Telegraph, Yogendra Prasad, chairman and managing director of NHPC said, 'Both the Union power and finance ministries have already approved the project. Only the Cabinet's nod is awaited, which is expected within another 15 to 20 days time. After that we will start work on the project.' The project is a joint venture between NHPC and the West Bengal State Electricity Board (WBSEB). Both parties had signed a memorandum of understanding in April early this year. The cost of the project, the NHPC chairman said, is Rs 3,188 crore. 'Out of the Rs 3,188 crore, 20 per cent will come in the form of equity and the rest will be in the form of loans.' The equity of the project is around Rs 1,200 crore. NHPC will contribute about Rs 800 crore towards the equity and the rest will be borne by WBSEB. 'Once the Cabinet okays the project, NHPC will start work on implementing the project,' Prasad said. Power department officials said, 'Both West Bengal and the eastern region have a predominantly thermal power generation system with an insignificant hydro power capacity. Against a minimum desired level of 40:60 hydro-thermal mix, West Bengal has only a 3:97 ratio. In the eastern region also, the ratio is less than 10:90. As a result there is an acute problem of surplus power during off-peak and deficit in peak-hour with a wide variation of frequency. The proposed project, with an installed capacity of 900 MW, will offer a pragmatic solution for meeting peak demand by utilising off-peak generation from thermal power stations, resulting in a better peak demand.