Hyderabad, March 21 (IANS): The Rural Electrical Corporation (REC) Limited, a central government enterprise, has come forward to fund power projects in Telangana to a tune of Rs. 24,000 crore.

Under a memorandum ofuUnderstanding (MoU) signed here on Saturday, REC will fund Telangana State Generation Corporation's power projects aimed at generating 6,280 MW.

The projects which will be funded are 800 MW at KTPS, 1,080 MW at Bhadradri in Manugur of Khammam district and 4,400 MW at Damaracherla in Nalgonda district.

REC chairman and managing director Rajeev Sharma and his TSGENCO counterpart D. Prabhakar Rao signed the MoU in the presence of Chief Minister K. Chandrashekhar Rao to mark Telugu New Year 'Ugadi'.

REC is a Navaratna Enterprise and provides financial assistance for rural electrification as well as all types of power generation, transmission and distribution projects.

With this, the state has achieved financial closure for all three power projects.

Earlier, the Power Finance Corporation (PFC) agreed to fund Rs.15,000 crore for the same projects and TSGENCO will fund Rs.3,000 crore, totalling Rs.42,000 crore.

This apart, the NTPC as mandated by the central government will be spending Rs.24,000 crore for its 4,000 MW project and Singareni Rs.4,000 crore. Another Rs.21,500 crore will be invested in solar projects and evacuation and transmission lines parallel.

"Thus the total investment for 10,280 MW of power plants in the next four years will amount to Rs.91,500 crore," said a statement from the chief minister's office.

At the request of the chief minister, REC reduced the rate of interest on its funding by 0.5 percent. This will reduce the burden on TSGENCO by about Rs. 600 crore.