Incentives for private power plants

PATIALA:

The Punjab government, in its cabinet meeting on Thursday, offered a series of incentives for those willing to set up power plants in the state.
The incentives were included in the Power Generation Policy announced on Thursday.

The incentives for new proj- ects included 100 per cent exemption from payment of fee and stamp duty for registra- tion for land, 100 per cent exemption from payment of change of land use charges and external development charges, 100 per cent exemption from entry tax and waiver of 50 per cent electricity duty for construction power. After restruc- turing of the electricity board, this is another major power sector reform undertaken by the Punjab government that will give a push to the power generation capacity.

The policy encourages setting up of power stations by private developers, which should bring down the cost of power and promote related ancillary industry.

The policy covers new power projects to be located in Punjab and also pit head and coastal thermal power plants, with an installed capacity of 250 MW or more at single location. It also includes expansion of the power projects, for which power purchase agreements stand signed and power projects allot- ted on Build-Own-Operate (BOO) basis.

The policy further said the state government will have the first right but not obligation for purchase of power up to 70 per cent of the installed capacity from the new projects that would come under this policy at the tariff approved by the state electricity regulatory commission.

In case of expansion of upcoming projects on BOO basis, the state will take 5 per cent of additional capacity at the quoted variable cost and additional 10 per cent capaci- ty on quoted tariff.

The policy defines the role of the government to facili- tate site selection, land acqui- sition, required clearances and connecting infrastructure. The government has offered vari- ous incentives to set up power generation projects.

All projects developed under this policy will be treated as industry and all incentives avail- able to new industrial projects will also be applicable to power plants.