State utilities' penalty burden close to Rs 900 cr in Bengal

An estimated Rs 900 crore penalty burden is staring at the state-owned power utilities in West Bengal following the recent Supreme Court verdict that cancelled 214 coal mines allocated since 1993.
"In a rough estimates the total penalty burden for West Bengal Power Development Corporation is Rs 800 crore and the rest (Rs 100 crore) for two other utilities with minimum impact," official sources said.
State's Power Minister Manish Gupta declined to speak on the issue. WBPDCL is the major power generating company that supplies electricty to West Bengal.
At a time when the state power utilities are not sound financially and the governemnt is facing financial crisis, the burden could prove to be costly.

ICRA VP Girish Kr Kadam said from 2008 to March 2014 WBPDCL aggregate mining is 24 million tonne of coal from three blocks - Tara east and West and Barjora blocks.
Meanwhile, penalty burden on CESC Ltd, a leading private sector utility that supplies power to Kolkata and Howrah is close to Rs 700 crore.

CESC operates Sarshatali Coal Block as captive linked to 700 MW capacity and they have mined close to 22 million tonne from 2008 to March 2014, Kadam said.
CESC Chairman Sanjiv Goenka did not respond to text messages while the CESC spokesperson declined to comment.

The apex court order demands a levy of Rs 295 per tonne of coal mined by the owners of the operational captive mines, out of total 214 mines which had been recently cancelled.
ICRA estimates total penalty due to the developments to the power sector is around Rs 6,000 crore.