I 1-----------------.------ --- --------:-------~-----~--- --------

A'r\VVe_. -~" .~."." ~"",,,.". v,,,,.

--L.. --.

No.10/1/2008-NHPC (Vol.V) Government of India Ministry of Power

SECRETPage ____of __

SECRET

Annex._____(Please refer para____ page____

~ ',. p

" ,.

~ I r

.'lJ\ II~' .

II"

Al'\n~. !A Government of India Ministry 0' Firyance~iV:'

Dep'artment of Expenditureif,;. ,r: SUbjGct: Public Investment Board. (PIB) Meeting for Ex- post facto approval for

formation and incorporation 'of Joint Venture Company among NHpJC,JKSPDC,.....

, "

and PTC and ihfusion of equity' beyond Rs.500 crore by NHPC .in JVC (MIs CVPPPL i.o.ChenabValley Power projects Pvt. Ltd.) and investment approval forr".,~; ...~ J.

, .',. cor.\structio~ of Pa.kal Du', HE Project. . Ministry of Power (i'vlP,P) may r~fer to the meeting of the PIB, held on MaybS, ' .

2013 to consider MoP's proposalon the subject mentioned above . ,.

\ \

2.. ' The PIB considered the proposal. After deliberations, the P.lB noted that the P project cost is too high, resulting in unsustainable first year tariff of Rs.. 9.74 pe~unit and levelized tariff of Hs. 8.22 p.er unit As such, the PIB directed MoP -to reformulate the proposal based orl the following recommendations:

.

..

'

. (i)' Debt Equity ratio 'of 70:30 may be revisited, as the cost of equity is comparatively high;

(ii) J&K Government may like to consider ways to reduce land cost and -- - - .. -", ...._-----incidence of state taxes;

(iii) Escalations, with refe~ence to the estimates based. on current price level, may be re-examin'ed:' ........ -......-.---.-----:-.-.--

~- -'- .

(iv) Effolis may be ma'd(3'lo reduce the completi'dh period ,'proposed at 6 years . . / '

. .. -- ' .. ,at present. , ........... - ...... , -.... , ... ~- ...~- .... ~.;", .. -"",.. -.,. --....~.- ... -- .. ~ .. "

" .

3. MoP may reformulate the projosal, before bringing it agafrL for cQnsideration of the P113. ' . . "." " . "':,:;;:;'