In the later half of the eighties, development of power generation in India suffered a major setback due to an acute lack of resources that could be deployed for the purposes. In order to give a boost to the installed generating capacities in the country so as to meet the growing demand and the nations aspiration for the new millennium, the Government of India amended the Indian Electricity Act 1948 during 1991. The amendment enabled the private investors to build, own and operate the power plants. The Government of India decided to allow the State Electricity Board to enter into MoUs with private firms on international level to invest in power project in India. Several investors responded and MoUs signed for various power projects based on coal, liquid fuels or natural gas. The group proposes to set up power projects in India with the power generation capacity of 20,000 MW in selective locations. The plants are proposed to be of thermal-based and/or hydro-based.

The group is going to set up gas based power generation plant under its subsidiary firm namely M/s. Kalgidhar Energies Inc. In the context of encouraging private participation in power generation, The group firm is going to set-up and establish a 1500 MW Multi-fuel power plant in the state at Malur near Bangalore.

Presently 5400 MW of power is available in the State of Karnataka. Of this, 60% is from Hydro Electric sources. The power situation in Karnataka is subject to the vagaries of the monsoon and during the years of poor rainfall sever power cuts have become unavoidable, as the case presently. Hence additional generation from sources other then hydro electric, including thermal and non conventional is essential to ensure reliability and stability of integrated electricity distribution system. Further, hydro electric power stations have unique peaking capabilities in integrated operations.  It is desirable to gradually increase electricity generation from all other sources of power up to a magnitude that will enable this attribute of hydro electric power to be optimally utilized.

Even though, potentially, there are additional sources of hydro electric power in Karnataka it is not a practical proposition to develop these quickly owing to opposition for ecological reasons and complication caused by inter state reverie disputes. The present shortage, as well as future growth of electricity demand in the state, can only be met by commissioning large thermal and Combined Cycle power plants (CCPP). The deficit in peak hour demand and annual energy requirements has been almost continuous. During the year 2005-06 these were 9.8% and 0.74% respectively. The load forecast for the state till year 2016 indicates that it is a modest increase of about 7% annually.