Ultra Mega Power projects

Ultra Mega Power projects (UMPP) are a series of ambitious power projects planned by the Government of India. Ultra Mega Power projects, each with a capacity of 4000 megawatts or above, are being developed.  The UMPPs are seen as an expansion of the MPP (Mega Power Projects) projects that the Government of India undertook in the 1990s, but met with limited success.

Basics of UMPP

  • UMPPs are very large sized projects, approximately 4000 MW each involving an estimated investment of about $ 4 billion.
  • The UMPPS in India are coal based and are to be developed on tariff based competitive bidding route using Super Critical Technology on build, own and operate (BOT)
  • The power generated by UMPPs is to be sold to States and SEBs.
  • The Ultra Mega Power Projects would use Super Critical Technology with a view to achieve higher levels of fuel efficiency, which results in fuel saving and lower green-house gas emissions. There has been a flexibility provided in unit size subject to adoption of specified minimum Supercritical parameters.
  • Each UMPP would be an integrated power project with dedicated captive coal blocks for pithead projects. However, the Coastal projects would be using the imported coal.

Role of Union Government

The Union Government helps in the project by

  • Coordination with State Governments to identify the suitable location for UMPP
  • Provide Coal Block Allotment or Coal Linkage to UMPP
  • Ensure the Environment/forest clearances
  • Provide Water linkage

Special Purpose Vehicle

Each UMPP will be represented by a Special Purpose Vehicle (a special company dedicated for a purpose) which will be the 100% owned subsidiary of the Power Finance Corporation. SPV obtains various clearances, water linkage, coal mine allocation (for domestic coal based projects) etc for the project. The SPV also initiates action for land acquisition in the name of the SPV, selects the developer through a tariff based competitive bidding process and finally transfers the SPV to the identified developer (such as Reliance Power, Tata Power, Adani Power etc.) along with the various clearances, tie ups, etc. The developer is then responsible to build, own, and operate these UMPP plants.

Role of State Governments

The states that host the UMPP would be to implement the Rehabilitation & Resettlement Plan for the locals whose land has been procured for UMPP, provide authorization to the PFC/SPV to carry out the bidding process on behalf of the distribution utilities, facilitate the signing of the Power Purchase Agreement, ensure proper payment security mechanism with the distribution utilities etc.