Power Giants Battling for Sinnar Thermal Power Plant: Submitted EOI

India’s power sector is abuzz with activity as 15 major companies, including industry giants like Adani Power, JSW Energy, and NTPC, have submitted expressions of interest (EOIs) to revive the struggling Sinnar Thermal Power plant near Nashik, Maharashtra. This 1,350 MW coal-fired facility, a subsidiary of RattanIndia Power and originally developed by Indiabulls Power, presents a rare opportunity in the Indian energy landscape.

Sinnar’s allure lies in its existing infrastructure. Unlike greenfield projects that require significant time and capital for land acquisition and construction, Sinnar boasts a vast 1,600-acre plot with only 110 acres remaining to be secured. This offers potential for expansion, allowing the new owner to double capacity by adding another 1,350 MW. However, a critical challenge remains – securing a reliable coal supply.

Sinnar’s past struggles with coal supply highlight a significant hurdle for potential buyers. In December 2022, South Eastern Coalfields, a government-owned supplier, cancelled its contract with the plant due to the absence of a long-term power purchase agreement (PPA) with a state electricity distribution company and the incomplete commissioning of the plant’s units. This cancellation compounded existing issues, as Sinnar’s previous PPA with Maharashtra State Electricity Distribution Company (MSEDCL) had already been terminated.

The path to revival began in January 2024 when the National Company Law Appellate Tribunal (NCLAT) allowed insolvency proceedings against Sinnar to move forward. This decision stemmed from a petition filed by Shapoorji Pallonji & Co., a construction firm seeking recovery of unpaid dues for their work on the plant.

With total outstanding dues reaching ₹15,909 crore, Power Finance Corp (₹6,553 crore) and its subsidiary REC (₹5,262 crore) stand as the top creditors. Other prominent lenders include Punjab National Bank, Axis Bank, Canara Bank, Bank of India, and Life Insurance Corporation (LIC).

Sinnar’s strategic location within the Sinnar Special Economic Zone (SEZ) offers further advantages. Situated approximately 50 km from Nashik city and just 4 km from a national highway, the plant benefits from good connectivity.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.