Tata Power to supply 500 MW to Reliance in April

Suburban power consumers will not pay more at least in April because their supplier Reliance Infrastructure will get 500 MW power from Tata at least for a month.

Suburban power consumers will not pay more at least in April because their supplier Reliance Infrastructure will get 500 MW power from Tata at least for a month.

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Tata Power Company (TPC) that told the state government on Tuesday that its decision to stop the supply of 500 MW of power to Reliance Infrastructure from April 1 was legal has now agreed to continue supply for another month.

A Cabinet sub committee headed by Chief Minister Ashok Chavan asked TPC to not discontinue the supply until an amicable agreement between the government, TPC and Reliance was reached.

As per the Cabinet’s directive a special panel headed by Chief Secretary, J. P. Dange will try to intervene in the dispute between the two city utilities. Reliance has been buying 500 MW of power from TPC at cheaper rates for several decades. TPC told Reliance six months ago that it would disconnect supply from April 1, 2010.

Dange’s panel has also been asked to explore possibility of uniform power tariff in the city because power from Reliance costs more than any other utility. TPC, Brihanmumbai Electric and Suburban Transport undertaking and state-owned Mahavitaran are the other suppliers in the city.

The government decided to intervene to avoid a power deficit in the suburbs where more than 26 lakh consumers may face a steep hike in tariff if Reliance spends Rs 600 to Rs 700 crore from sources other than TPC.

Reliance asked the government to convince Tata so that consumers are not burdened further. Reliance needs about 1,400 to 1,500 MW daily of which it generates 500 MW and buys the rest from other suppliers. The matter had come up for discussion in the ongoing legislative session.

Neither company was available for comment. State officials refused to speak on record because of protocol reasons.