Nagpur: The Second Capital of Maharashtra is losing its image as one of the most preferred investment destinations in the country. In a major setback to the industrial investment scene of Nagpur, the Nasdaq-listed company ReNew Power has shelved the project because of unrealistically high power tariffs, said a report in local media.
The proposed mega project was projected to be a game-changer for the Additional Butibori MIDC Area with a staggering investment of Rs 18,000 crore. It was estimated that the project had a potential of generating employment for 3,000 persons, and required 300 acres of land. ReNew Power was planning to set up a metallurgical grade silicon, polysilicon and ingot-wafer manufacturing facility in Nagpur.
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According to the report, ReNew Power has shelved plans for the mega project as high-ranking Government officials refused to offer lower than regular power tariffs to the company. Numerous meetings and discussions between the company representatives and high-ranking Government officials remained inconclusive.
In June 2023, the State Government had signed an Expression of Interest (EoI) with ReNew Power for setting up the unit in Nagpur. The investment was to be historic in many ways, as it would have brought highly sophisticated manufacturing technology and processes in the solar energy sector.
The media report further said that during the negotiations, ReNew Power demanded power at concessional rate of Rs 5 per unit for a period of 10 years, but the State Government officials assured power at Rs 5.50 per unit. Similarly, State Government officials had assured ReNew Power to provide all necessary clearances and ‘No Objection Certificates’ within 45 days for the project. As of now, the project stands abandoned, the report added.
Sumant Sinha is Chairman and CEO of ReNew Power. He established the company in 2011. He is the son of Yeshwant Sinha, former Finance Minister, and brother of Bharatiya Janata Party leader Jayant Sinha. PricewaterhouseCoopers (PwC) was the project consultants of the company. There is a huge competition for mega projects and every State in the country is wooing companies to invest by offering attractive benefits along with handholding support for all types of clearances and NOCs, the report stated.
According to the report, somewhere, Maharashtra is lagging in this process. How many more companies willing to invest in Nagpur were going to back out due to illogically high power tariffs and allegedly defunct policies of the State Government.
Earlier, the company officials had visited Additional Butibori MIDC Area scouting for land and conducted a feasibility study. As per the current status of the project, there has been no new development and the project stands stagnant. The report said that many power intensive industries like steel mills and secondary steel manufacturing units had migrated out of Vidarbha to Chhattisgarh and Gujarat. Higher power tariffs are deterring new industries from coming to Vidarbha and investing in Additional Butibori MIDC Area, which has all the infrastructure facilities like road, rail, air connectivity, ample land, consistent power supply, availability of skilled manpower among others.
The industries are now demanding special power tariff for units based in Vidarbha to compete with the units in neighbouring States like Chhattisgarh, Madhya Pradesh, and Telangana where power tariff is lower than that charged by MSEDCL in Maharashtra. Though the Government is offering rebate of Re 1 per unit and exemption in Electricity Duty, it is nullified by charging Fuel Adjustment Charges and higher power tariff, the report added.
ReNew Power had chosen Nagpur because of its strategic location. The place also provides a hot and dry climate conducive for manufacturing of solar wafers. Besides, time-saving connectivity of the region with Jawaharlal Nehru Port Trust via Samruddhi Expressway would be an advantage and benefit the company. The company had also been planning to set up the R&D centre near the unit to deliver cutting-edge products required for future industry requirements.
Had the plant been set up, there was a possibility of ancillary units with additional investment of Rs 2,000 crore coming up. Alas, it is not the case!
