Indo Rama seeks Centre's nod to sell Madhya Pradesh unit's surplus power

Indo Rama seeks Centre's nod to sell Madhya Pradesh unit's surplus power

Girish Chadha

New Delhi, July 18: Indo Rama Synthetics has sought government permission to sell surplus power generated at its 100 per cent export oriented unit(EOU) in Madhya Pradesh to companies in the domestic tariff area. The company has taken up the matter with the ministries of industry and commerce as well as the Central Board of Excise and Customs. The company has contended that the excess power available at its EOU should be allowed to be sold to its other units in the domestic tariff area as well as to other units on payment of proper duty on fuel/inputs. The revenue department is believed to have agreed to transfer of surplus power generated from one EOU to another but has not agreed to the request for transfer of power to any other unit. The company has said that its 4mw DG set at its EOU is capable of producing 75,000 units of power daily whereas the company requires about 50,000 units, thus running the DG set at low efficiency. An additional 25,000 units, which can be produced at the recommended load factorof 80 per cent, can be used by any other manufacturing unit as the power supply position in the region is very grim. Indo Rama has said that the EOU is generating power, which should be considered as one of the commodities being produced and therefore its sale to domestic tariff area units, should be allowed at least to the extent of 50 per cent as per the policy guidelines. In its letter, the company has said that by allowing transfer of surplus power to DTA units, the company will not only be able to attain lower fuel consumption per unit of power by running the DG set at full capacity but also power will be made available to other units. The company had transferred the 4mw DG set to the Pithampur unit from another of its unit near Nagpur in Maharashtra last year to meet its power requirement.

In the right direction

It is strange that the government allows excess power generated in an 100 per cent EOU to be sold to another EOU but not to the domestic tariff areas.

Considering the fact that theentire state suffers from a shortage of power, the government should be willing to accept power from any source it gets. One reason for doing so can be that certain incentives are given to companies for setting up infrastructure facilities like a power plant within an EOU, which gives them an added advantage of producing power at a lower cost. But then these could be offset by charging the companies a one-time duty before allowing them to sell power to domestic tariff areas. The primary issue should be to make power available to the industry, rather than bother about issues such as from where it is generated.

--Shishir Asthana

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