Rural Electrification Corporation signed memoranda of understanding on Friday in the presence of state electricity minister P Thangamani to provide financial assistance of Rs 60,063 crore and Rs 25,660 crore to Tangedco for implementing power and transmission projects in the next 8 years in Tamil Nadu. The REC also handed over a sanction letter for rupee term loan of Rs 10,453 crore for establishment of thermal power projects in Udangudi and Kadaladi in Tuticorin and Ramanathapuram.” The REC funding comes at a lower interest rate of around 8%. Along with the financial support of Power Finance Corporation (PFC), the total funding to Tangedco by the two corporations will cross Rs 1 lakh crore, the investment target set for power sector in Vision 2023,” a senior Tangedco official told TOI.
The Tangedco plans to increase its own generation capacity to the extent of 13000MW in the next 8 years. It is also planning to set up a mega solar power plant with a capacity of 500MW at Kadaladi. “It has also proposed to establish 550 substations at various capacities ranging from 765KV to 33KV and transmission lines to the extent of 1,250km, thereby strengthening and improvement of sub-transmission and distribution network for evacuation and supply of uninterrupted power to all categories of consumer,” said the minister.In March, the PFC sanctioned Rs 9,128 crore to Tangedco to set up 2 x 800MW supercritical thermal power plant at Uppur in Ramanathapuram district. “Out of the total amount sanctioned by PFC, Tangedco will utilise Rs 5,474 crore for the Uppur thermal units. The two units are expected to generate power from May 2021. Part of the loan will be utilised for Sholayar Power House projects with capacities of 2 x 42MW and 2x35MW,” said the official.
With lower losses and a better rating at B grade by the Union power ministry, Tangedco is set to get funding at a better rate of interest for its future projects. “We have reduced the losses from Rs 13,000 crore to Rs 3,000 crore last year. With this, our rating will also go up and we expect to get A or A++ rating and this would further boost our stand in the financial market,” said the official.