Power shortage continue on one hand and oil prices are rising on the other. Although the Kudankulam nuclear power plant would help increase power supply to southern states, this also gives an opportunity for Tamil Nadu to expand the 4 x 500 MW lignite based plant
The oldest power plant in Neyveli, set up 50 years ago, using locally mined lignite as fuel, and having done great service, will now be phased out. This 600 MW unit is proposed to be replaced by a new plant, which will have 2 units of 500 MW capacity each.
Estimated to cost Rs4,751 crore, this will be setup in the next three to four years. According to Surinder Mohan, Chairman and Managing Director of Neyveli Lignite Corp Ltd, orders have been already placed with Bharat Heavy Electricals Ltd (BHEL), at a cost of around Rs3,592 crore for boiler and turbine generators (BTG).