Texas Power Generation Announces Ambitious Plans to Invest in India's Power Sector

Strategic Insights -

Texas Power Generation LLC, a Houston-based company, has announced plans to invest up to $10 billion over the next decade in India's power sector. The company has signed a Memorandum of Understanding (MoU) with the Chhattisgarh government to set up a 1,600 MW coal-fired power plant with an investment of approximately Rs 60 billion ($1.35 billion). The project, which is expected to be completed by 2010-11, will be financed with a debt-equity ratio of 70:30, with the company investing $400 million as equity entirely through internal accruals.

Key Takeaways:

  • Texas Power Generation LLC plans to invest up to $10 billion over the next 10 years in India's power sector.
  • The company has signed an MoU with the Chhattisgarh government to set up a 1,600 MW coal-fired power plant with an investment of approximately Rs 60 billion ($1.35 billion).
  • The project, expected to be completed by 2010-11, will be financed with a debt-equity ratio of 70:30.
  • The company will invest $400 million as equity through internal accruals and arrange debt from European and US lenders.
  • The project is the first to be set up by Texas Power Generation LLC globally.
  • The company has initiated talks with various states, including Andhra Pradesh, for a 2,000 MW plant.
  • Foreign participation in India's power sector has been limited, with the notable example of Enron's abandoned Dabhol plant in Maharashtra.

Statistics:

  • $10 billion: The amount Texas Power Generation LLC plans to invest in India's power sector over the next 10 years.
  • 1,600 MW: The capacity of the coal-fired power plant to be set up with the Chhattisgarh government.
  • $1.35 billion: The approximate investment for the 1,600 MW power plant.
  • 70:30: The debt-equity ratio for the power plant project.
  • $400 million: The amount the company plans to invest as equity through internal accruals.
  • 2010-11: The expected completion date for the 1,600 MW power plant project.

Sources:

  • (PTI) 20-02 1035: Asia Pulse, "Texas Power Plans Major Power Plant in India"