File picture of the NTPC power plant in Talcher.

Bhubaneswar, April 24: The dream of Odisha — a coal-rich state — becoming the powerhouse of the country, is yet to materialise with major projects failing to take off.

Of 29 memoranda of understanding (MoU) it has signed with private companies since 2004, only one project has been commissioned. Seven are in advanced stages of construction.

The state government today decided to extend the term of MoU of these seven projects that are expected to be commissioned during 2013-14.

The decision was taken at a meeting chaired by chief minister Naveen Patnaik today to review the renewal of power project MoUs.

“MoUs of those companies that are in an advanced stage of construction will be extended within two months,” said chief secretary Bijay Kumar Patnaik.

The remaining projects have failed to take off because of land acquisition problems, delay in forest and environment clearance and want of coal blocks. The state is struggling to meet its power demand, which varies from 2,700MW to 3,300MW. The state produces 2,400MW and depends upon captive power plants to meet the shortfall.

All the 29 MoUs inked with the state government during the past decade for establishment of thermal plants have expired. The signatories included major players such as Tata Power, GMR Energy, Mahanadi Aban Power Company, Jindal Steel and Power, Bhusan Energy and Lanco Group.

Energy minister Arun Sahoo said the state-run Industrial Promotion and Investment Corporation Limited (Ipicol), the nodal agency for the industrial project clearance, would visit the 29 thermal project sites. A joint verification team consisting of experts from the energy and industries departments will be constituted for the purpose. The verification report will be submitted to the taskforce headed by the energy secretary, which will select the projects for which MoUs may be extended, official sources said.

The state government had signed MoUs with 30 private power companies during the past decade to set up independent power plants mainly in Jharsuguda, Angul and Dhenkanal districts, where coal mines are located.

These projects, in which Rs 1.5 lakh crore was estimated to be invested, would have collectively produced around 35,000MW power.

The MoU of Essar Power Limited was cancelled, as it could not “make any progress”. Of the remaining 29 projects for which MoUs were inked, Sterlite Energy’s 2,400MW thermal plant set up at Jharsuguda has become fully operational. The power plant of Arati Steel Limited has also started production. It was revealed during today’s review that the first unit (350MW) of GMR Energy located at Kamalanga in Dhenkanal district was synchronised in January and the rest (three units) were expected to be ready within the current year.

Six other power projects have progressed significantly and are expected to be commissioned within a year or two.