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India's largest generation utility NTPC is planning to expand into cement manufacturing with the twin objectives of utilising fly ash from its power stations and create captive demand for electricity.

The state-run utility is inviting expression of interest from cement makers on Thursday, offering partnership for building the proposed cement plants in the vicinity of its power stations, company executives told TOI on Wednesday.

NTPC is looking at building cement plants with annual capacity of 1 million tonne or more in the vicinity of its power stations - both in operation and under construction. These plants will be offered to the chosen partners on BOO (build, own, operate) basis.

The company is also open to helping with land, water and power wherever possible. The partners will have to sign a long-term contract for sourcing ash from NTPC and will be responsible for marketing of products.

"The notice seeking EOI is to gauge the interest of existing players in the cement market. The pattern of joint ventures will be decided on the basis of loacation and feasibility of each cement plant proposed by the interested manufacturers," one NTPC executive said.

NTPC had first toyed with the idea of getting into cement manufacturing in 2008 and had six power stations for building cement plants. But the plan failed to get off the ground due to tepid response from cement makers. Subsequently ion 2010, the company brass decided to go it alone and initiated talks with Cement Corporation of India. But this move too did not make much of progress.

A cement foray is important for NTPC as it will help the company meet the environment ministry's norm envisaging 100% utilisation of fly ash. The company produces 65 million tonne a year of ash, part of which is being used as landfill and for brick-making, embankments etc.

Besides, a cement JV will help NTPC find captive consumers for generating capacity, which are under contract with state utilities, but being surrendered by discoms either due to lack of buying capacity or availability of cheaper supplies from electricity exchanges.

Source: TOI