Monday, February 23, 2015

Cabinet subcommittee formed to take final call on govt involvement in Teesta Urja for Stage III

The State Government has constituted a Cabinet Sub-Committee to examine all issues related to the Sikkim Government taking a major equity stake in Teesta Urja Hydro Power which is developing the 1,200 MW Teesta Stage III hydel project in North Sikkim.  The Cabinet Sub-Committee is headed by Power Minister DD Bhutia, and includes GM Gurung, Minister for Roads & Bridges; RB Subba, Minister for Human Resource Development; and PB Subba, Principal Chief Engineer-cum-Secretary, Energy & Power Department as Member Secretary. The subcommittee, as mentioned, will examine issues in connection with raising the equity stake of the Government of Sikkim through the Sikkim Power Investment Corporation Limited (SPICL) to 51% in Teesta Urja Limited (TUL) in relation to Teesta Stage III.
The Cabinet had cleared the conversion of TUL into a Sikkim State Public Sector Undertaking with 51% equity share of the State Government on 18 December last year.
When contacted, the Power Secretary informed that the 1,200 MW hydel project is expected to be operations by the end of this year. He further confirmed that the State Government had already taken up a 26 percent equity in the power project which is being developed in PPP mode.
While the Cabinet has already cleared increasing the govt stake in the project to 51% and thereby converting TUL into a State PSU, a final decision has not been inked yet and will now depend on the recommendation of the Cabinet Sub-Committee.
The State Government has already invested Rs. 530 crore as 26 percent equity and this investment will go up to Rs. 1,150 crore now and help achieve the target of making the project operational in a more time bound manner, Mr. Subba said, adding that the State has already appraised the Electricity Regulatory Commission for loan to invest as equity share. Teesta Stage III has been plagued by cost over-runs and operational delays and the 18 September 2011 had delivered a debilitating blow to the project, a setback from which the project developers could never fully recover. The immediate target is to have the first phase of the project in operation by mid-2015.

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