India's first geothermal plant to be set up in Andhra Pradesh

India's first geothermal plant is expected to come up by 2012, with an initial capacity of 25 mega watt (MW) at an investment of US$ 64.66 million in the Khammam district of Andhra Pradesh (AP). It will be set up by Mumbai-based GeoSyndicate Power Private Ltd, a company incubated by the Indian Institute of Technology (IIT), Bombay, which has a special focus on exploration and production of geothermal energy. It has already entered into a power purchase agreement (PPA) with Warangal-based Northern Power Distribution Company that was recently signed under the aegis of the Non-conventional Energy Development Corporation of Andhra Pradesh Limited (NEDCAP).

A power plant based on geothermal energy basically harnesses the heat from the earth's inner layers to produce electricity. Advancement of drilling and heat exchanger technology is making it increasingly easier for developing countries to utilize their enormous untapped geothermal energy resources, according to Dr D Chandrasekharam, Chairman, GeoSyndicate and a well-known geothermal expert and faculty member at Department of Earth Sciences, IIT-Bombay. This project will offer a unique chance for India to step up and make headway in the huge opportunities available in the geothermal sector.

He also disclosed that per unit cost of electricity would be below US$ 0.22, making it cheaper and more affordable than electricity rates from solar farms. Presently, the project does not have any government aid and the company is looking at private funding. The estimated total potential of the Khammam site is approximately 60 MW that will be realized over a period of time. The plant will stand on a total area of just one acre and power produced will be from non-polluting sources, making it an attractive carbon credit project. This is significant against the backdrop of growing global challenges of global warming and climate changes.

Andhra Pradesh is the first state in India to execute such an agreement.