Hyderabad, October 15: Chief Minister K Rosaiah’s Government has landed in its first controversy.
It is under flak for the issuance of a GO (No 135) by the Energy Department allowing four independent power producers to sell 20 per cent of power they generate on the open market.
The four producers are: GVK Extension (220 MW), Vemagiri (of GMR) (359 MW), Konaseema (432 MW), and Gouthami (464 MW). Their total installed capacity is 1,475 MW.
The AP Electricity Regulatory Commission (APERC) will have a hearing on the order tomorrow since objections are being raised in several quarters.
TDP president N Chandrababu Naidu and Telangana Rashtra Samiti (TRS) chief K Chandrasekhara Rao have demanded that the government withdraw the GO forthwith.
By allowing the four companies to sell 20 per cent of the power they produce in the open market, the State, which is perennially starved of power, will face an additional shortfall of 300 mw.
According to sources, the pressure from the said producers began with the companies urging the State government to enhance the tariff from Rs 1 to Rs 1.17 stating that they were incurring losses in gas-based power generation due to shortage in gas supply. But the government did not accede to their request and said it would be willing to consider any other proposal to help them extricate themselves from losses. They then asked the government to allow them to sell 20 per cent of the power generated by them on the open market, regardless of their installed capacity.
The proposal was approved by a committee headed by the then finance minister K Rosaiah who was appointed to look into the matter, after which it was approved by the State Cabinet and referred to the APERC.
But even before the APERC could deal with it, the State Government issued the GO yesterday formalising the Cabinet decision. Principal Secretary of the Energy Department AK Goel issued the order quoting Section 108 of Electricity Act 2003, and maintained that amendments to the Power Purchase Agreement enabling the companies to sell 20 per cent of their power were “made in the public interest”.
Sources said that all the four companies claimed that they had been “suffering losses” in power generation since their inception.
Interestingly, they could not explain to the APERC how they had been incurring losses.
It is also learnt that some officials in the State Secretariat were keen on getting the proposal approved and that it was among the first few files Rosaiah signed after taking over as chief minister. In case the APERC approves the government decision, petitioners who filed cases against the proposal with the commission earlier are contemplating moving court. However, they are awaiting the final verdict of the APERC
–Agencies–