Union power minister, P R Kumaramangalam, did take a lot of bold policy decisions in this sector, which forced the state governments and the electricity boards to move toward initiating reforms.

For instance, the policy decision such as only those states will be the beneficiaries of cheap power from the forthcoming mega power projects, who will set up the electricity regulatory commissions. This move did push the states towards initiating reforms and most of the states have now agreed in principle to constitute these regulatory commissions.

However, with the fall of the BJP government, it is feared that the mega power projects and the setting up of the Power Trading Corporation (PTC), which were initialled and taken ahead vigorously by none other than Kumaramangalam himself, may have to face a rocky pathahead under the new government.

There were as it is, many reservations being expressed by experts and from various other quarters of the industry. The question which is now doing the rounds of the power sector is, whether or not, the new government would support setting up of these projects in the same way and also whether the concept of constituting a PTC, with the proposed security package, as suggested under the previous government would remain the same. Moreover, it is also to be seen if the special duty benefits worked out for mega power projects will get the support of the new government.

With the Finance Bill yet to be passed, there is also a big question mark on the fate of other duty incentives given to the power sector in the Budget 1999-2000.

Even the deadline set for the 30 power projects to achieve financial closure has lost its meaning now, many projects which were being pushed by Kumaramangalam may now slow down and take a back seat.

On the other hand leading IPPs, promoting the liquidfuel projects, who have been up in arms against the Union government's decision of providing duty benefits to the mega power projects, do see a ray of hope, as they feel that the new government would look into their long standing demand of providing them a level playing field with mega projects.

According to them, the benefits of duty free imports cannot be selectively given to certain power projects, leaving others at a serious disadvantage in fending for themselves for the future.

"These incentives have had a serious impact on the ongoing power projects as well as on the projects under discussion. It has even resulted in killing many projects as even the FIs and banks have begun to re-orient their approach toward a tariff based project. As a result of the concessions, the mega power projects have a undue advantage over others. Under the previous government, the power ministry had focussed its entire attention on the setting of the mega power projects and did not do much to help the other IPP projects,once conceived as the short gestation projects, sail through.Now we can once again take up the issued coming in the way of the liquid fuel projects and hope that the new government corrects this anomaly of special duty benefits being provided to mega projects", said a leading IPP.

Justifying these duty benefits, the promoters of the mega power projects, on the other hand, feel that the duty concessions given to them would substantially bring down the cost of power thereby giving a choice to the SEBs to buy cheap power from power plants.

Undoubtedly, the matter is of serious concern as the government from the past five years has been inviting IPPs to set up power plants of various sizes and types, right from 50 mw liquid fuel (at Rs 3 plus per unit of first year tariff) to 500 mw coal-based projects (at Rs 2.70 per unit first year tariff). Although if the SEB commits to buy power at these prices as well as electricity from the mega power projects, there is no cause of complaint by dozens of IPPs who havespent crores of money developing this projects over all these years.