Promit Mukherjee 
 
Mumbai: JSW group has signed a multi-million-dollar deal with Japanese major Toshiba Corp for setting up a manufacturing facility for supercritical steam turbines and generators.

The manufacturing facility, spread over 100 acres in Tamil Nadu, will soak up an investment of $250 million.

S S Rao, joint managing director and chief operating officer, JSW Energy Ltd, said, “There are two critical components for every power plant - one is fuel and the other is equipment. Therefore, we decided to secure at least one of them at an early stage.”

Under the terms of the agreement, a joint venture company will be set up wherein Toshiba will have a 75% stake and JSW the rest (JSW Energy will hold 20% and JSW Steel 5%).

He said under the first phase of investment, the joint venture will invest a total of $50 million in a 70:30 debt-equity ratio.

“The first phase is expected to be complete by the end of 2009 and we plan to reach the second phase by the end of 2012,” Rao said.

The facility will service the requirements for 9,600 MW of supercritical capacity proposed by it in different parts of the country. “These projects are at various stages of allotment,” Rao said.

Since the facility will be based on supercritical technology, the plant will manufacture steam turbines and generators in the range of 500 MW to 1,000 MW.

“There is a severe constraint on the availability of supercritical class steam turbines and generators. Therefore, a foray into domestic manufacturing will give us lot of cost efficiency,” said Rao.

The company plans to add 2,880 MW by the end of December 2010, under the first phase rollout of its power plans.

“We have already placed orders with China-based Shanghai Electric for projects with a total capacity of 3,600 MW. All these projects are based on sub-critical technology,” he said.

Source : DNAIndia