In order to sort out the formalities related to allocation of land for the proposed 1,250-MW plant on the Puthuvype island, the Cochin Port Trust and the State government are working jointly. It is close to the LNG terminal being set up by Petronet LNG Ltd.
However, the issues related to allocation of land would be resolved to show the way for a rebound in the industrial fortunes of Kerala.
It still reports 300-MW power deficiency during peak hours while allocation of land would be cleared within a fortnight and there were 2 plots of land available for the power plant and the suitable 1 would be allocated.
Meanwhile, Principal Secretary to the Prime Minister T.K.A. Nair asked the Cochin Port Trust to allocate land for the power station while this was in order to review the progress of the work on the International Container Trans-shipment terminal on the Vallarpadam Island.
Moreover, the proposed power project on the Puthuvype island would be a gain for the State, with industries here benefiting from cheaper electricity and the Cochin Port Trust benefiting from higher volumes of LNG traffic.
Power generated from LNG would be cheaper than power from naphtha although the price of gas was yet to be fixed while several industrial units, including the public sector Fertilizers and Chemicals Travancore (FACT) plan to use LNG once it is available in Kochi.
The proposed power plant on the Puthuvype island had also the capacity to change the State's electricity consumption profile.
Currently, domestic units account for more than 75% of the power consumption, with industries representing less than 2% of the total power used in the State while commercial and agriculture sectors account for around 20% of the power consumption.
On the other hand, setting up of the LNG-based power plant will take the investment in the Puthuvype area to more than 20,000 crore while it is expected to be operational from March 2012.
It involves an investment of Rs.4,000 crore and the supply pipelines being set up by the Gas Authority of India involves an estimated investment of another Rs.4,000 crore.