Cabinet approves amendments in Mega Power Policy 2009

NEW DELHI (INDIA): The Cabinet Committee on Economic Affairs, chaired by the Prime Minister of India Narendra Modi has approved the time period for the provisional Mega projects (25 projects), for furnishing the final Mega certificates to the Tax authorities be extended to 120 months instead of 60 months from the date of import.nnDevelopers would be required to keep their Fixed Deposit Receipt (FDR) or Bank Guarantee (in lieu of duty exemption claimed) alive.nnThe CCEA also approved 25 Provisional Mega certified project for Mega Policy benefits in proportion to the long term PPA (Power Purchase Agreement) tied up, as permitted under the Mega Power Policy, once the specified threshold capacity of the project, gets commissioned. However, the money realized by the developer, if any, as a result of release of proportionate Bank Guarantee would first be utilized towards the repayment of the Bank dues by the developer.nnA suitable mechanism will be worked in consultation with Department of Revenue for operationalisation of release of proportionate Bank Guarantee.nnThis is expected to enable developers to competitively bid for PPAs |in future. Once the developer commissions the specified threshold capacity, proportional mega benefits would facilitate easing out liquidity crunch with the developers/Banks and improve the viability of their projects. Increased power availability will boost overall growth of the country and also ensure that cost of power to the consumers does not increase.