State decided against renewing lapsed MoU of Essar Power due to lack of initiative shown by company in pushing ahead its project NHPC-hydro power producer Peeved over the inordinate delay in implementation of their power projects, the state energy department has decided to scrap memorandum of understanding (MoUs) signed with three independent power producers (IPPs) – Vijayaa Ferro & Power Ltd, Adhunik Power & Natural Resources Ltd and Astaranga Power. "The progress achieved by these IPPs is far from satisfactory. They have not even signed power purchase agreements (PPAs) with Gridco. The fate of their proposed projects is almost sealed since the state government has decided in principle to cancel their MoUs”, said a senior state government official. Astaranga Power Ltd had entered into an MoU with the state government in February 2009 for establishment of 2640 Mw coal fired power plant at Astaranga in Puri district at a cost of Rs 11,200 crore. Both Vijayaa Ferro & Power Ltd and Adhunik Power & Natural Resources had signed MoUs with the state government in April 2010. Vijayaaa Ferro & Power had proposed 120 Mw plant at Turlakhamar in Kalahandi district at an investment of Rs 550 crore. Adhunik Power & Natural Resources' 1320 Mw power project was to come up at Biramaharajpur in Sonepur district at a cost of Rs 8079.74 crore. Earlier, the state government had decided against renewing lapsed MoU of Essar Power due to lack of progress on its project. The company had inked an MoU with the state government in September 2006, committing an investment of Rs 4602 crore on its 1000 Mw coal-fired power project. The state government had signed MoUs with 30 IPPs that promised a combined generation capacity of around 37,000 Mw. The state's share from these projects was pegged at about 6000 Mw. Vedanta Resources owned Sterlite Energy is the first IPP to have gone into production. The company has commissioned its 2400 Mw plant at Burkhamunda near Jharsuguda. GMR Energy, another MoU signed company, has commissioned two 350 Mw units out of 1400 MW project at Kamalanga in Dhenkanal district. The other IPPs that are expected to go on stream by 2013-14 are Lanco Babandh Power Ltd, KVK Nilachal Pvt Ltd, Ind-Barath Energy (Utkal) Ltd, Maa Durga Thermal Power Company Ltd, Jindal India Thermal Power Ltd (JITPL) and Nava Bharat Power Pvt Ltd. As many as 19 IPPs were awaiting renewal of their lapsed MoUs. The state energy department had prepared the draft MoUs which mandate the IPPs to retain at least 51 per cent stake in their power projects for a minimum of three years from the date of commissioning of their plants. The IPPs whose MoUs are awaiting extension include Tata Power, GMR Kamalanga Energy Ltd, Navabharat Power Ltd, Visa Power, Sterlite Energy Ltd, Lanco Power and KVK Neelachal Power to name a few.