New Delhi: State-run Coal India Limited’s (CIL) plan to set up two pithead supercritical thermal power plants — one in Odisha and another in Madhya Pradesh — through its subsidiaries Mahanadi Coalfields Ltd (MCL) and South Eastern Coalfields Ltd (SECL) has received a nod from the Cabinet Committee on Economic Affairs (CCEA). “The Cabinet Committee on Economic Affairs chaired by the Prime Minister Shri Narendra Modi today approved proposal for equity investment by (i) South Eastern Coalfields Limited (SECL) for setting-up 1×660 MW Thermal Power Plant through JV of SECL and MPPGCL; and (ii) Mahanadi Coalfields Limited (MCL) for setting-up 2x800 MW Thermal Power Plant through Mahanadi Basin Power Ltd (MBPL - a subsidiary of MCL),” said an official statement on Thursday.
The SECL plant is a single unit coming up at Madhya Pradesh Power Generation Company Limited’s (MPPGCL) Amarkantak Thermal Power Station in Village Chachai, Anuppur district, Madhya Pradesh. It will be a 660-MW Supercritical Coal-Based TPP. The MCL plant is coming up in Sundargarh district, Odisha, and will be a 2×800 MW (1,600 MW) Supercritical Thermal Power Plant.
The CCEA has approved the proposal of equity investments by SECL, MCL and CIL, said the statement. Equity capital of Rs 823 Crore (± 20 percent) by SECL, considering a debt-equity ratio of 70:30 and 49 percent equity investment in JV Company with an estimated project capex of Rs 5,600 crore (accuracy of ±20 percent) for the proposed 660 MW Supercritical Thermal Power Plant through JV of SECL and MPPGCL has been approved.
Equity Capital of Rs 4,784 crore (± 20 percent) by MCL for the proposed 2×800 (1,600) MW Super-Critical Thermal Power Plant with an estimated project capex of Rs 15,947 crore (accuracy of ±20 percent) through MBPL has also received the CCEA’s nod. The CCEA has also granted an approval to MBPL, an SPV of MCL, to set up the 2×800 (1,600) MW supercritical thermal power plant.
In addition, the Cabinet has also approved equity investment by CIL beyond 30 percent of its net worth in the JV of SECL-MPPGCL (Rs 823 Crore ± 20 percent), and in MBPL, a 100 percent wholly-owned subsidiary of MCL (Rs 4,784 Crore ± 20 percent).
India has been witnessing a rise in power demand year after year and the trend is projected to continue. The Central Electricity Authority (CEA) has projected a peak power demand of 256 GW in 2024-25, which is substantially higher than the peak witnessed in 2023-24 — 243 GW. To meet this rising demand, the government has planned to set up thermal power plants close to pitheads. A coal pithead is located close to a coal mine and is an area where the mined coal is kept before being transported to power plants. Locating a thermal power plant close to a pithead allows quick availability of coal as no to minimum transportation is involved, which also makes coal cheaper for the power generation company.
“Coal India Limited (CIL), the largest coal mining company in the world, will set up following two Pithead Thermal Power Plants, through its subsidiaries, with a view to provide cheaper power to the country,” said the government.
Supercritical thermal power plants are the standard for new coal power plants, as their efficiencies can reach around 44 percent, compared to older coal power plants that operate around 33 percent. Improved efficiency corresponds to fewer greenhouse gas emissions, as well as pollutants like NOx, SOx, and particulate matter. According to the World Coal Association, a supercritical coal plant (as opposed to a traditional coal plant) will decrease waste heat produced by 25 percent, and cut pollution and CO2 by roughly the same amount.