Coal India Limited (CIL) and NLC India Limited (NLCIL), coming together in a significant step, have inked a Memorandum of Understanding (MoU) on Monday in CIL headquarters, Kolkata for formation of Joint Venture (JV) Company for Solar Power Generation of 3,000 MW and Thermal Power Projects of 2,000 MW capacity. Binay Dayal, Director (Tech) CIL signed the MoU on behalf of CIL while N N Maheswar Rao, Director, Technical (Projects & Planning) inked the pact on behalf of NLCIL in the presence of Anil Kumar Jha, Chairman CIL and Rakesh Kumar Chairman, NLCIL.

CIL is tasked to become a Net Zero energy company by Ministry of Coal, a move which entails the company to generate 3,000 MW of solar power. The MoU, also extends for 2,000MW of thermal power generation across CIL’s subsidiaries. Solar power projects will be set up in the identified barren and reclaimed free land of CIL and also across the country where land is available, requiring around 15,000 acres. The estimated cost for CIL’s solar power generation is pegged at Rs. 12,000 Crores. The JV company to come up on equal equity participation of 50:50 has a time line of 15 months for completion of solar power projects and 60-month period for TPPs.

“This is a synergistic step, combining the resources of both the for a common goal. Coal India will be riding the core technical expertise of India in thermal power generation and solar power”, a Coal India official said.

The solar power projects will be set up in some of the identified barren and reclaimed free land of Coal India.

Besides, additional land may be required to set-up the solar projects. It is estimated that this JV will be needing around 15,000 acres of land to set-up the solar generating stations.

In the past, to pursue its ambitious solar power venture, Coal India had submitted a Green Energy Commitment letter to Ministry of New and Renewable Energy for developing 1000 MW solar power projects and an agreement was also signed with (SECI) to set up part of the project in Madhya Pradesh.

“But, due to a downward trend in prices of solar projects and availability of land in Madhya Pradesh Solar Park, the tenders were cancelled”, a Coal India official said.

Previously, while talking to Business Standard, Coal India’s chairman cum managing director, A. K. Jha said that this company is targeting to evolve into an energy company from being just a mere miner and the upcoming power projects are a step into that direction.

“There are a few places where evacuation will still be a problem even with our best efforts. So we can use the pithead stock after the requisite evacuation to feed power plants which can be constructed at the pitheads itself”, Jha said earlier during an interview to this newspaper.

The JV wit NLC India will not only help Coal India meet the ministerial directive but will also help it diversify and open new avenues of revenue at a time when thermal power generation is expected to stagnate.