While the Rajasthan state electricity board (RSEB) has given first lien on the escrow account to RPG Dholpur, IDBI, while part funding the Dholpur project, has insisted that the two projects must share the escrow proceeds pari passu.

The RSEB has provided Chambal Power with fourth lien on the escrow list.That is not all. IDBI, on behalf of Chambal Power, has requested the RSEB to grant the institution a dedicated escrow account, which, if it is granted, will resolve the issue of whether or not funds should be shared parri passu from the escrow account. This has resulted in a stalemate which may eventually stymie the progress that RSEB has made in setting up the elaborate escrow-account mechanism for the independent power projects. BothChambal Power and RPG Dholpur were not available for comments on the issue.

It is believed that IDBI had initially been appointed the lead institution for RPG Dholpur, but later, ICICI was given the mandate. The face-off and the demand made by IDBI on the RSEB deals another blow to the creation of escrow accounts for independent power projects. The system, first suggested by Crisil two years ago has failed to take off in any state so far, largely due to procedural hassles.

The 702-mw RPG Dholpur project will cost Rs 2,300 crore, for which institutions have already approved term-loans aggregating Rs 1,010 crore. Of this, ICICI has provided the maximum-Rs 600 crore. The balance has been split at Rs 200 crore each between IDBI and IFCI, while Rs 10 crore is being provided by GIC.

The RPG group will pick up 35 per cent equity in the project, while Siemens, the engineering, procurement and construction contractor, will pick up 15 per cent equity.