REC disburses Rs.16,070 crore to Telangana for power plant

REC disburses Rs.16,070 crore to Telangana for power plant

Rural Electrification CorporationHyderabad:(IANS) The Rural Electrification Corporation (REC), a central government enterprise, on Tuesday disbursed a Rs.16,070 crore loan to Telangana for construction of 4,000 MW Yadadri power plant.

REC chairman and managing director Rajeev Sharma handed over the cheque to Telangana Chief Minister K. Chandrasekhar Rao here.

Sharma said that this is for the first time in the history of REC that such a large amount is disbursed in a single installment. He attributed this to the commitment and planning of the state government.

With this, REC has so far disbursed Rs.20,391 crore to Telangana, the highest for any state.

It had earlier disbursed Rs.4,321 crore towards construction of 800 MW power plant at Palvancha.

In March, REC had agreed to fund the power projects in the newly created state to a tune of Rs. 24,000 crore.

Under a memorandum of understanding (MoU) signed then, it agreed to fund Telangana State Generation Corporation’s three power projects aimed at generating 6,280 MW.

REC is a Navaratna Enterprise and provides financial assistance for rural electrification as well as all types of power generation, transmission and distribution projects.

According to a statement from the chief minister’s office, though REC provides loans for power plants at 11.5 percent, it reduced the rate of interest on its funding to Telangana by 0.5 percent. This will help the state save Rs. 500 crore.

In addition to this, Power Finance Corporation will be funding a 800 MW power plant in the state to a tune of Rs.4,000 crore.

The state government had announced in March that it achieved financial closure for 10,280 MW of power plants. The total investment will be Rs.91,500 crore in the next four years.

The state aims to become electricity surplus by 2018.