Ultra Mega Power projects (UMPP) are a series of ambitious power projects planned by the Government of India. With India being a country of chronic power deficits, the Government of India has planned to provide 'power for all' by the end of the eleventh plan (by 2012). This would entail the creation of an additional capacity of at least 100,000 MW by 2012. The Ultra Mega Power projects, each with a capacity of 4000 megawatts or above, are being developed with the aim of bridging this gap.
The UMPPs are seen as an expansion of the MPP (Mega Power Projects) projects that the Government of India undertook in the 1990s, but met with limited success. The Ministry of Power, in association with the Central Electricity Authority and Power Finance Corporation Ltd., has launched an initiative for the development of coal-based UMPP's in India. These projects will be awarded to developers on the basis of competitive bidding.[1]
Based on supercritical technology, 16,000 MW of capacity has been contracted through the competitive bidding process for UMPPs. Two more UMPPs, one in Orissa and the other, in Chhattisgarh, are in the pipeline. The average tariff for these projects is in the range of two to three Rs per unit which is much lower than the recent cost plus tariffs. The first supercritical unit is expected to be commissioned in Mundra (Gujarat) by the end of 2011.
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As of Nov 2010, 16[2] UMPPs have been planned in Karnataka, Chattisgarh, Madhya Pradesh, Andhra Pradesh (2)[3], Maharashtra (2), Orissa (3)[3], Tamil Nadu (2), Gujarat (2)[3] and Jharkhand
| State | Location | Capacity (MW) | Awarded |
|---|---|---|---|
| Chattisgarh | Akaltara | ||
| Gujarat | Mundra | 4000 | Tata Power |
| Karnataka | Kudgi | 4000 | NTPC |
| Madhya Pradesh | Sasan | 3960 | Reliance |
| Maharashtra | Giriye | 4000 | |
| Andhra Pradesh | Krishnapatnam | 4000 | Reliance |
| Orissa | Lankahuda (Sundergarh district) | NTPC | |
| Tamil Nadu | Cheyyur | Kanchipuram district | UMPP |
| Jharkhand | Tilaiyya | 3960 | Reliance |
Of these, the ones planned in Chattisgarh, Madhya Pradesh, Orissa and Jharkhand will come up at pithead locations (near coal mines) and use domestic fuel, while the rest will come up in coastal locations with easy access to imported coal. On the request of the state governments of Andhra Pradesh and Orissa, two more sites have been identified, which consist of a pithead site in Ib-Valley coalfield in Orissa and a coastal site at Krishnapatnam in Andhra Pradesh. The contract for Mundra UMPP has been given to Tata Power while Sasan, Tilaiyya and Krishnapatnam contracts have been awarded to Reliance Power Limited, a part of Reliance Anil Dhirubhai Ambani Group. A UMPP at Bedabahal (Orissa) has recently been cleared by central government[4].
The project is being developed with the intention of providing power to consumers at minimum cost. Because of the huge size of these power plants, the cost of the electricity would be lower due to the economies of scale. The plants are estimated to cost roughly Rs. 15,000 crores each to set up.[5] The cost of generation per unit is estimated at under Rs. 2.00.[6]
Special purpose vehicles, or shell companies, have been set up as wholly owned subsidiaries of the Power Finance Corporation Ltd. (PFC) in each of the above states to build, own, and operate ("BOO" in economic parlance) these plants. The proposed shell companies are as follows:[5]
Special Purpose Vehicle (SPV) obtains various clearances, water linkage, coal mine allocation (for domestic coal based projects) etc. for the project. The SPV also initiates action for land acquisition in the name of the SPV, selects the developer through a tariff based competitive bidding process and finally transfers the SPV to the identified developer along with the various clearances, tie ups, etc.[7]