Tata Power to ramp up capacity by 8500 MW in 2 years

Tata Power's ultra-mega power project (UMPP) should be commissioned by September and the company plans to take capacity at the plant to over 8500 mega watts in two years. CNBC-TV18's Sajeet Manghat and Vidhi Godiawala report.

Tata Power is all charged up. The company is on track to commence operation of the first unit at its Mega power project in Mundra by September.
With this, 1,600 megawatts of power generation will begin... and the target of 8500 MW by 2013 will be that much closer to fruition.
It already has capacity of 3127 megawatts... and will add the balance 5300 MW in the next two years. Here's how that's going to happen:
Tata Power will commission its 1050 MW Maithon project in June this year... and the entire project will be onstream by the year-end. It will also add 1600 MW from Mundra, 148 MW in wind energy, and 25 MW in solar energy by the end of FY12.  It further plans to fully commission the remaining 2400 MW Mundra UMPP next fiscal.
Given these ambitions, Tata Power is leaving no stone unturned... especially to ensure adequate coal linkages.
It recently raised 450 million dollars via hybrid securities, and will use the funds to repay 240 million dollars of debt on existing coal assets. The balance will be sed to finance coal asset acquisitions in Indonesia and Mozambique.
Tata Power needs USD 2.2 billion to complete existing projects -- of this it will raise USD 1.72 billion in debt, with internal accruals bringing in the rest.
It is in the process of tying up debt to the tune of 500 million dollars. A major chunk of this will be used to expand the distribution business in Mumbai. But the 8500 megawatt target is not enough.
Tata Power has already set in motion the next phase of expansion.
It is acquiring land for a 1600 MW imported coal based project in Coastal Maharashtra and a 1980 MW project in Orissa.
In addition it plans to begin work on phase 2 of its Maithon plant for 1320 MW and phase II of its Mundra plant for 1600 MW.
With this in mind, Tata Power is likely to tap the capital markets sometime in the next two years.