UP dresses up old power projects

The three power projects for which UP has recently signed power purchase agreements (PPAS) with the private companies have a history of 10-15 years. But due to factors ranging from differences among the decision takers to refusal of the earlier companies to carry out their mandate, these were not implemented.

However, UP power officials are now certain that these would be come through, even when the unions remain circumspect.

Among the three, the Srinagar hydel project was the first one on which work was started by the Uttar Pradesh State Electricity Board (UPSEB). But it was halted in 1993, when the government chose to accept the report of the World Bank consultants and decided to hand over the project to the private sector.

They found one in Duncan Industries of GP Goenka. The latter, in collaboration with an Australian firm, started planning the project. However, but that too did not remain for long.

Later the Tatas showed interest. UP signed a PPA with Duncan Industries as well as the Tatas. However, the Tatas too grew lukewarm to the project. Now it has been given to GVK Industries. But the regulator has put a condition that no change in promoter will be accepted till the project is completed. Power will cost Rs 2 a unit and 88 per cent of its 330 Mw power will accrue to UP.

While Ashok Khurana, secretary, power, is confident that the project would now get implemented, Employees Union Leader Shailendra Dubey said, "Let us see."

A major change, however, has taken place in Roja Power, earlier conceived by the Birlas, who signed the first power purchase agreement in 1993. But by 2006, they decided to hand over the company at book value to Anil Ambani's Reliance Energy, signalling what appears to be the Birlas' withdrawl from the power sector, except of course for captive generation as at Hindalco.

For Ambani it is some consolation, after losing the bid for Anpara C to Lanco and checked at Dadri by a conglomeration of politicians, led by VP Singh and others.

Anil Ambani immediately raised the planned capacity to 1,200 Mw from 600 Mw, which will qualify it to get the status of mega project. The latter, a scheme of the Centre, ensures that the Customs duty gets drastically reduced, which also reduces the price of power.

Thus for the first 600 Mw for which the PPA has been signed, the cost of power will be Re 2.57 a unit. However, when the picture shown above materialises, the price for consumer will get reduced by about 13-14 paise.

Khurana said, "The assurance given to us is that the project will be onstream in 44 months from the date of signing of the PPA." The first phase is projected to cost Rs 2,461 crore.

A new phase in the battle for Anpara C is set to begin. The project, handed over to Lanco Kondapalli of Hyderabad, will see a renewed struggle between workers and the UP government over the handing over of the project to a private sector company.

But the government is adamant it goes to the private sector. The employees say Anapara C was conceived much earlier and some common facilities were created for this purpose. Therefore, it would be better if all of them remain under one company.