For the first time in the history of Indian Gas power sector, AP DISCOMs have acquired 216 MW Gas based GVK Power plant located in East Godavari District which will be boon for AP Power sector. In Tune with the policy of the state govt. in further strengthening generation capacity in public sector, the AP power utilities have made arrangements for third party appraiser for assessing the value of the GVK plant at Rs.261.27 Crores as against Rs.293.37 crore quoted by GVK Management.
This is the first gas-based power plant operated in India after the reforms in power sector in late 90s.
Disclosing the details K. Vijayanand, chief of AP Transco and AP Genco directed the engineers to operate the newly acquired generating plant immediately. During the meeting it was declared that, hence forth the acquired generating Gas Based GVK plant to be named as Godavari Gas Power Plant (GGPP).
Mr Vijayanand along with Director, Finance have handed over the cheque for Rs. 261 crore to the representatives of GVK Ltd., and entered into the sale agreement with them for the acquired plant. Simultaneously the plant and its operations have been taken over into the control of APGENCO and DISCOMS from GVK in Jegurupadu, East Godavari district.
The plant was till now owned and operated by GVK Industries with a power purchase agreement with the Four Distribution Companies of combined A.P. The PPA was entered in April 1996 and expired in June 2015 after completing a period of 18 years.
Though the PPA expired on June 20th last year, APDISCOMS to have a very comprehensive assessment of the plant operatability took almost one year to finalize the deal. An independent appraiser was appointed to assess the value of the plant as per the terms and conditions stipulated in the PPA.
The initial valuation done by the third party agency was Rs.293.37 crores after prolonged negotiations by a high level negotiation committee with M/s.GVK and finalized the deal at Rs.261.27 crores.
· For the ease of smooth taking over and maintaining this project, 60 employees from APGENCO headed by a senior superintending engineer who have relevant experience in Gas based plants were deputed to the project. This arrangement will be for 3 years initially.
The gas plant located in lush green forest environment in an extent of 211.735 Acres is known for its very clean and green environment and it is the first plant in the entire country to have entered PPA with power utilities. The plant also has a private zoo is about 10 Acres with various birds and animals. With the acquisition of the plant, APDISCOMS have become first in the country to have their own gas plant. It is anticipated that the gas plant will be very handy for the DISCOMS to maintain the grid exigencies in an effective manner particularly with the advent of huge capacity additions in non- conventional energy sources such as solar and wind.