Maharashtra won’t buy power from Dabhol project, says CM

  • Sayli Udas Mankikar, Hindustan Times, Mumbai
  • Updated: Feb 13, 2015 18:13 IST

It is clear for now that the defunct 1,967-MW Dabhol power project will be revived, but the state won’t benefit from it as it has been decided that power will not be bought from there owing to higher tariff.

With the option of selling off the unit to a private entity being ruled out, the government does not lose its control over the power project.

“The plans to sell off the unit to private players is not on the cards. Unless you ensure the gas supply and develop the LNG terminal, no one will come forward,” said chief minister Devendra Fadnavis, who attended a meeting with Union power minister Piyush Goyal and other stakeholders, including bankers from the Ratnagiri Gas and Power Private Ltd (RGPPL), to discuss the options of reviving the power plant. It has been defunct since December 28, 2013.

Fadnavis said that GAIL, the main stakeholder, will continue to run the re-gasification LNG terminal for which the company will earn Rs1,200 crore. For the main power generation to take off, they will need to get gas at a higher rate. He added that the state government has told RGPPL it will issue a no-objection certificate (NOC), telling them to go ahead and sell the power to other states.

“The current calculations has put the price of power from Dabhol at Rs5.50 per unit, while the state now pays Rs3.30 for old and Rs4 per unit for electricity from new plants. The plant can go ahead and sell power to states such as Chhattisgarh, which face power crunch,” Fadnavis said on behalf of MSEB, which holds 17.41% equity stake in RGPPL.

According to the power purchase agreement between RGPPL and Mahavitaran, the state power company will have the first right to refuse electricity. Also the two are fighting it out in the tribunal, with Mahavitaran asked to cough up Rs2,200 crore as debts to the power plant.

“We will challenge this in Supreme Court. RGPPL has violated the PPA by not informing us about the gas it was buying, which was costs beyond what was agreed on,” the CM added.

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