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The Magnetohydrodynamic power generation technology (MHD ) is the production of electrical power utilising a high temperature conducting plasma moving through an intense magnetic field. The conversion process in MHD was initially described by Michael Faraday in 1893. However the actual utilisation of this concept remained unthinkable. The efficiencies of all modern thermal power generating system lies between 35-40% as they have to reject large quantities of heat to the environment. In all other conventional power plant, first the thermal energy of the gas is directly converted in to electrical energy. Hence it is known as direct energy conversion system. The MHD process can be used not only for commercial power generation but also for so may other applications.The economic attractiveness of MHD for bulk generation of power from fossil fuel has been indicated in many design studies and cost estimates of conceptual plants. MHD promises a dramatic improvement in the cost of generating electricity from coal, beneficial to the growth of the national economy. The extensive use of MHD can help in saving billions of dollars towards fuel prospects of much better fuel utilization are most important, but the potential of lower capital costs with increased utilization of invested capital provides also a very important economic incentive.