In the power starved state of Tamil Nadu any addition to electricity generation capacity, howsoever small, helps. In a few months, the State is likely to get 100 MW of capacity from Sterlite Industries.

The company part of the Vedanta group, which specialise in metals, has a copper smelter plant at Tuticorin near the southern tip of Tamil Nadu.

As part of its INR 2,500 crore expansion project, Sterlite Industries is putting up a 160 MW power project two coal fired units of 80 MW each at a cost of INR 650 crore. The first unit has just gone on stream.

Sterlite would need 65 MW of capacity for its own needs. The unit is capable of producing 400,000 tonnes of copper cathodes, but this year it will produce 365,000 tonnes. Since each tonne requires 1,600 units, the smelter would need about 65 MW of capacity for itself. The rest of the power generation is to be sold in the market.

Mr P. Ramnath CEO of Sterlite Copper said that the company is negotiating a power purchase agreement with Tamil Nadu’s electricity distribution utility Tangedco.

Currently, Sterlite is paying about INR 7 for each unit of electricity. Ramnath reckons that with the captive generation, the power cost of the unit will come down by half a saving of INR 20 crore, for the current level of copper production.