A 300 MW thermal power project in Chattisgarh is set to become the first such project in India to achieve financial closure on the strength of a power purchase agreement (PPA) with a power trading company. Previously, private sector power projects have been financed on the basis of PPAs with state electricity boards (SEBs).

The Hyderabad-based Lanco group has signed a PPA with the Power Trading Corporation (PTC) for the output of the plant, located at Pathadi-Saragbundia villages on the Champa-Korba state highway. The debt-equity ratio for the Rs 1,100 crore (euro 1.9 million) plant is 70:30 and financial closure is expected soon.