About OPG

The OPG Power Group is committed to building and maximizing shareholder value by being the first choice provider of reliable, continuous, uninterrupted power supply at competitive rates to leading industries across India. In pursuing this objective, OPG will build and operate Group Captive Power plants of medium size, up to 500 MW, each plant serving groups of  customers in select industrial belts and maintain the highest standards of environmental conformity and operating efficiency.

The OPG Power Group's mission is to become the preferred provider of reliable, uninterrupted power supply at competitive rates to industries in India. In delivering this service, OPG aims to operate as an efficient, low cost producer maintaining the highest technical standards and to exceed the norms prescribed by the environmental regulations.

OPG Power Ventures PLC was established in the Isle of Man in January 2008 to develop, own and manage power generation facilities in India.

The Directors believe that the prevailing and expected electricity demand and supply imbalance in India presents significant opportunities in the power generation sector for the Group. They further believe that the Indian government's vision of "Power for All" by 2012 will require aggressive growth and increased private sector participation. The Indian government has created a regulatory environment to encourage private industry investment in the power sector to assist in relieving the current demand and supply imbalance and the Directors believe the Company to be ideally placed to be a leader in this sector.

The Group set up the first power plant in 2004 in Tamil Nadu and this plant generates 19.48 MW of gas fired power. In addition, the Company currently has a 10 MW plant due to commence production in the 3rd quarter of 2008, an 80 MW plant which will become operational by the second quarter of 2009 and a further plant of 2 x 135 MW which is due to commence operations by March 2010. The company is listed in the Alternative Investment Market of the London Stock Exchange since May 2008 and has the following subsidiaries/investments in the Indian power businesses of the group.

• OPG Energy Pvt Ltd (19.4 MW) :29.80 % voting and 44 % Economic Interest.
• OPG Renewable Energy Pvt Ltd (10 MW) : 22 % voting and 33 % Economic interest.
• OPG Power Generation Pvt Ltd (80 MW) : 70 % voting and 99 % Economic Interest.
• OPG Power Gujarat Pvt Ltd (2 x 135 MW) : 70 % voting and 99 % Economic Interest.

The plants  of the Group Power busines are more fully described under Power Generation facilities. All  the OPG power plants operate as Group Captive Power Plants (GCPP's), a dispensation of the Govt of India which is described below :

In June 2005, the Ministry of Power prescribed rules that provided the regulatory framework for a developer, such as the Company, to promote and set up a Group Captive Power Plant (GCPG). A consumer of group captive power is able to enjoy the benefits of reliable, uninterrupted power at prices that are agreed directly with the producer. Given that these modern GCPPs are more efficient than many of the plants producing electricity in India, power tariffs are generally lower than those charge by the SEBs. The regulations governing GCCP stipulate that:

• At least 26% of the ownership of the power plant must be held by the captive users;
• At least 51% of the annual power output of the plant must be consumed by the captive users;
• The tariff charged by the operator is determined by the operator and the users of the plant;
• The tariff may be independently determined by mutual agreement and the Regulator is not required to vet or approve the pricing.
• Open access to transmission lines for GCPP's is mandated by the Electricity Act
• GCPPs are exempt from paying any surcharge or other charges except the actual transmission charges;
• Grid access and transmission are overseen by the State Regulator.

The rising shortage of power, combined with the deteriorating quality of supply, has compelled more industrial consumers to depend on captive power generation to meet their power requirements. As of March 2008,  the installed captive capacity in the country is more than 20,000 MW accounting for around 15 per cent. of the total installed capacity in India.