ADAG Feels the Heat as TPC plans to go to Court

The Tata Power Company’s (TPC) decision not to pay heed to the Maharshtra government’s diktat to sell power to RInfra has exposed the state’s lackadaisical approach to the power sector. The state was seen forcing TPC to share its electricity under the garb of ‘consumers’ interest’ even as consumers of the state-owned power entity are facing huge power shortages.

A section of the government officials believe that the state government should not have got involved in a war between two corporate houses. “We (the government) have no reason to meddle especially after the issue was first addressed by Maharashtra Electricity Regulatory Commission (MERC) and then by the Supreme Court. The state’s intervention was uncalled for,” admitted a senior government official. According to this official, the state government ignored dissenting voices on the issue.

As has been reported, the Supreme Court last year upheld the TPC’s contention not to supply electricity to RInfra in the absence of a formal power purchase agreement between the two. The TPC had set April 30 deadline for RInfra to sign a PPA. When the deadline passed with no agreement, RInfra sought the government’s intervention. RInfra claimed that it would be forced to raise tariff if TPC discontinued power supply. The state, fearing the tariff hike may create a “law and order problem”, first directed the TPC to maintain the status quo and later appointed a committee to find a solution.

Experts point out that when the state government decided to step in, it didn’t even try to look fair. “When the government was seen trying to resolve the issue, it should have adopted a balanced approach,” a senior official from the state power utility said. “If the government was keen on playing an adjudicator, it should have asked RInfra to sign a power purchase agreement (PPA) with TPC while insisting the latter to keep the supply on,” this official felt.

Watch it on Youtube: Tata Power, Reliance Infra faceoff

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