US Report Claims Proposed Cheyyur Power Project is Not Financially Viable

CHENNAI: The proposed 4,000 MW coal-fired power plant in Cheyyur taluk of Kancheepuram district will either be a loss-making proposition or consumers will have to pay higher tariffs, a US-based Institute for Energy Economics and Financial Analysis (IEEFA) said in a report commissioned by the Chennai based think-tank Indian Institute of Public Policy.

The IEEFA report, based on publicly available documentation on the plant, states that the tariff of power generated would be Rs 4.9/unit in the first year of operation (2021) and would level off to Rs 5.95/unit over the plant’s lifetime reaching Rs 8.3/unit in 2036.

“It does not include cost overruns as a result of delays in land acquisition or on-the-ground resistance or increase in international coal prices,” said Jai Sharda, the copartner of Ahmedabad based Equitorials, an Indian financial analysis company that has prepared the financial model for the report.

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