Vidarbha's Private Power Producers Accuse MSEDCL Of Misusing Monopoly | SupportBiz

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Vidarbha's Private Power Producers Accuse MSEDCL Of Misusing Monopoly

 
Tags: power plant
The private companies are producing power at the rate of Rs 3.50-4 per unit while the State-run Maharashtra State Power Generation Company's (MahaGenco) new unit's rates are above Rs 5 per unit.

Nagpur, January 2: Amidst protests from environmentalists and numerous government norms, the private power plans in Vidarbha region are in dire need of an immediate government intervention to survive. It's now feared that an investment of Rs 20,000 crore will be wasted and the lending financial institutions will have to bear the brunt if situation does not improve soon.

The situation will not only cause loss of at least 5,000 jobs, but will end the source of cheaper power, The Times of India reports (Read the Full Story). It should be noted that the private companies are producing power at the rate of Rs 3.50 - 4 per unit while the State-run Maharashtra State Power Generation Company's (MahaGenco) new unit's rates are above Rs 5 per unit.

Some of the power producers in the region are mulling the options of filing a case against the monopoly of Maharashtra State Electricity Distribution Company Limited (MSEDCL) with the Competition Commission of India. The report further states that industries and consumer activists are thinking on the same lines as they would prefer the MSEDCL power that is the cheapest, and not from Mahagenco just because it is a government company.

"When we expressed our intent to set up power plants in the state, the energy department made us sign an undertaking that we will sell at least 50 percent of power generated by us in the state. Now the government is practically not allowing us to sell power to industries due to extremely high cross subsidy surcharge while MSEDCL has told us that it does not need our power. What are we supposed to do," Padmesh Gupta, director of Gupta Group of Industries, was quoted as saying to TOI. Gupta said the heavy transmission charges makes it impossible for Vidarbha's plants to sell power outside the state.

Many private plants including Reliance's 600MW Butibori plant, Gupta Energy's 120MW plant at Usegaon and Abhijeet Group unit remain closed now. KSK's 540MW plant at Warora is operating at half the capacity, GMR has put up its 540MW plant at Warora for sale and Ideal Energy has not been able to start its 270MW plant at Bela, the report said.