Power regulator raps J&K for not paying dues

Power regulator CERC has rapped Jammu and Kashmir government for endangering northern grid security by repeated violations of grid code regulations and for not paying outstanding dues of over Rs 473 crore.

On a petition by PowerGrid Corp's northern regional load dispatch centre, the Central Electricity Regulatory Commission observed that despite an earlier directive, the state had continued with heavy overdrawls during December 2005 and January 2006, "frequently endangering the grid security."

NRLDC, which manages the northern transmission grid, had also said the state's power development department was yet to pay dues totalling Rs 473 crore, excluding interest, which were outstanding till February 12, 2006.

"The overdrawls and non-payment of UI (unscheduled interchange) charges by the primary respondent (J&K) has a chequered history,"

CERC noted, but accepted the new schedule given by the state for payment of dues. UI charges is the amount paid for purchasing electricity on short-term basis, usually bought daily and settled weekly, from the grid over and above the quota allocated to the state.

"We accept the time schedule for settlement of existing as well as current dues. We have adopted the course because of our desire to settle the long outstanding issue. However, any violation of the time schedule will attract penal action under the law," CERC said in its order.

The regulator said the state government had in February 2005 assured that overdrawls from the grid would be limited and dues would be settled. However, despite the assurances and CERC's directions the state government did not make any payment after Rs 49.94 crore in August 2005.

In its reply, the power development department said it had issued three cheques (payment advice) totalling Rs 100 crore and would pay the balance in phases by March 31, 2007.

However, CERC observed that instead of cheques or drafts which could be directly credited into a bank account, the PDD was issuing only payment advices to the state treasury.

"There is also a history of the payments not being released for months even after issuance of such payment advice," the regulator said, and directed that it would be the responsibility of PDD to do the necessary legwork in the state, and ensure that the payment gets credited into the correct account being operated by NRLDC for this purpose.

During the hearings, Delhi Transco opposed the schedule given by J&K for settlement of outstanding bills on grounds that most of the dues were recoverable by DTL who has paid its dues to the generating companies from whom power is being purchased.