Bharat Heavy Electricals (Bhel) will float a 50:50 joint venture with Japan’s Toshiba Corporation

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to manufacture high-capacity transmission and distribution equipment in India and other mutually agreed countries.

The joint venture will undertake marketing, designing, engineering, supply, erection, testing and commissioning of equipment and projects in extra high voltage alternating current (EHVAC) and ultra high voltage alternating current (UHVAC) range including 765 kV transformers, reactors and gas insulated switchgear (GIS).

An MoU in this regard was signed on Wednesday by Bhel chairman and managing director B P Rao and Toshiba Corporation corporate executive vice-president Hideo Kitamura. Rao said the partners were working on the investment and other details and the joint venture was expected to be incorporated by June this year.

The joint venture will receive technology from both Bhel and Toshiba. With the joint venture, Bhel is targeting Rs 1,000 crore business from engineering, procurement and construction of transmission projects in the initial phase. The proposed company seeks to bridge gap in the present offerings from Bhel for 765 kV transmission systems and GIS for which there is huge and growing demand in the country. The government plans to augment the inter-regional transmission capacity to 37,150 mw by 2012. Major investments have been lined up for building high-capacity transmission highways consisting of 400 kV and 765 kV transmission lines and HVDC bipoles to evacuate power from north eastern region and eastern region of the country to northern region and its connectivity with the western region.

Country’s largest electricity transmission utility PowerGrid Corporation of India is also planning to move to the next higher voltage for the grid by setting up 1,200 kV transmission lines by 2012-13.

Bhel, the country’s largest power equipment company, at present manufactures transformers, shunt reactors, instrument transformers, capacitors, extra high voltage circuit breakers and medium voltage switchgear at Bhopal, Hyderabad and Jhansi.

The company has a capacity to manufacture 45,000 MVA of transformers and reactors per annum at its Bhopal and Jhansi plants. The company also manufactures 12,000 MVA large-sized EHV, HVDC and UHVAC transformers and reactors at Bhopal.

The company has a technology tie-up with Swedish ABB for high-voltage direct current transmission systems and manufactures power transmission systems. At present, a transmission business group in the company undertakes projects on turnkey basis for AC switchyards/substations of up to 400 kV, and converter stations among others.