After Reliance Industries refused to supply gas to Bawana power plant, the Delhi government has now sought an intervention from the Prime Minister's office (PMO) on the issue.
A delegation of senior Delhi government and power department officials recently met the PMO officials to seek resolution to the problem.
According to Delhi Government officials, there is a demand-supply gap in power in the city that has made the R4,500crore Bawana plant crucial to meeting Delhi's rising demand for power. The Bawana plant is slated to provide 1500MW electricity to Delhi.
"We approached the PMO to seek supply of gas for the plant. The PMO indicated that the issue will be resolved very soon," a senior Delhi Government official said.
Power department officials said the Centre had allocated 0.93 million cubic meters per day of gas (MCMD) from Reliance's Andhra offshore KG-D6 fields for the Bawana plant for 2009-10 and 2010-11. But Pragati Power Corp, the Delhi government's company that runs the plant, could not sign the gas sales purchase agreement with Reliance Industries Ltd on time since its power project had gotten delayed.
Later when Pragati Power approached Reliance in April this year to sign the contract, Reliance said it was in no position to sign any fresh contract since output from its field had dropped to about 47MCMD, far less than about 58MCMD for which it had already signed supply contracts.
In the absence of KG-D6 gas, the only option left for Bawana is to use imported LNG that will cost three times more.
Delhi government officials said they have already told the Central government that running the Bawana plant in open cycle with liquefied natural gas (LNG) will be "highly uneconomical".
Work for the Bawana power plant began in March 2008.
The plant was scheduled to be ready well ahead of last year's Commonwealth Games, held in October, but missed the deadline.