The Central Electricity Authority (CEA) will take up with the ministry of external affairs the increase in the tariff on power drawn from the Chukha hydel power station in Bhutan.
The ministry's decision to increase the tariff from Re 1 to Rs 1.50 per unit has created strong dissatisfaction among the consumers of Chukha power in the eastern region. Though the new rates came into effect from last July, the consumers are not paying the enhanced rate.
The PowerGrid Corporation buys the power at Chukha and sells it to various eastern region consumers.
The proposal is to charge Rs 1.50 for eight months of the year, while the rate will remain unchanged for the four monsoon months, thereby subsidising power from Chukha. Bhutan, however, will be paid at the rate of Rs 1.50 for the whole year.
Of the estimated 1,320 million units of energy generated at Chukha, as much as 800 million units is sold during the four
monsoon months. On an
average, therefore, the Chukha power costs Rs 1.20 a unit for
the consumers.
The chairman of the electricity authority, R N Srivastava, heard representation from the eastern region consumers when he was in Calcutta last week about the steep hike in Chukha power. There is little reason, they argued, to raise the tariff on hydel power. The eastern region has very little hydel power source. The region is, therefore, burdened by high-cost thermal
power.
The Chukha power at Re 1 per unit was a source of cheaper power. The original price of Chukha power was 50 paise a unit. If the rate is raised to Rs 1.50, it will be almost the same as the cost of power from the Farakka power station of the National Thermal Power Corporation (NTPC).
In fact, in March, when the plant load factor (PLF) of the Farakka station was 61 per cent, the month's tariff was Rs 1.53 a unit. When capacity utilisation improves, the Farakka tariff may well be cheaper than the Chukha tariff.
The Chukha power station was set up in Bhutan with assistance from the Government of India in the mid-80s. Power from Chukha was first priced at 27 paise a unit. It was raised to 37 paise in 1993, 50 paise in 1995 and then to Re 1 in 1997.
The consumers lodged their protest in 1997 as the rate was doubled. However, they were persuaded to pay the tariff. When the rates were raised again last July, consumers refused to pay. Hydel power, they said, becomes zero-cost energy as the power station becomes older.
For Bhutan, the revenue from Chukha is extremely important for its economy. The agreement which determines the price of Chukha power in consultation with the government of Bhutan did not expect that protests will take such a shape.
