Essar Energy Plc, today said its indirect subsidiary, Essar Power Jharkhand Ltd, has signed an agreement with the Bihar State Electricity Board to supply 450 MW of electricity to the latter for 25 years.
The Power Purchase Agreement (PPA) is for 450 MW of contracted capacity from the 1,200 MW coal-fired Tori I power project to be located in Latehar district in Jharkhand, a press release issued here stated.
The agreement is valid for a period of 25 years from the start of commercial operations.
Under the terms, Essar Power Jharkhand will supply power to BSEB at a levellised tariff of Rs 2.64 per kwh (about US cents 5.62 per kwh). EPJL was awarded the contract following a competitive bidding process.
The balance of power from Tori I can be sold by EPJL on the open market.
Commenting on this agreement, Essar Energy CEO Naresh Nayyar said: “The signing of the power purchase agreement with BSEB completes the offtake arrangements for the Tori I power plant. This is a further milestone towards securing our long term revenue stream and increasing our generation capacity from 1,220 MW to more than 11,000 MW by the end of 2014.”