Simultaneously, the CAG has criticised the MSEB for remaining its investment of Rs 215.75 crore on lines and substations idle for 10 to 40 months "due to non-availability of power from Koyna stage IV, Dabhol Power Company and Narmada project and mismatch in completion of related substation/lines."

The CAG report for the year ended March 31, 1999 submitted to the state legislature remarked that PLF in both thermal and gas-based plants were below norms fixed by Central Electricity Authority. It further said that MSEB had to resort to purchase of power involving extra expenditure of Rs 945.81 crore following the generation of 1,23,674 MUs agtainst the targeted generation of 1,39,404 Mus during the seventh plan period.

The CAG pulled up the MSEB for its failure to achieve a rate of return of 3 per cent prescribed in the Electricity (Supply) Act, 1948 in any of five years even after grant of subsidy of Rs 558.20 crore by government and increase in tariff of high tension industrial consumers.

According to the CAG, non-completion of system improvement schemes in four urban centres, scheduled to be completed between 1994-95 and 1997-98, deprived MSEB of estimated additional annual potential revenue of Rs 222.15 crore. "Against the norm of 15.5 per cent prescribed by CEA, transmission and distribution losses increased from 15.83 per cent in 1993-94 to 17.73 per cent in 1997-98 which led to loss of revenue of Rs 420.05 crore on energy lost in excess of norms.

The report further said that delay in payment dues by MSEB for supply of power and fuel attracted surcharge interest of Rs 620.94 crore for late payment, besides cut in central plan assistance to state government. This further affected the developmental programmes in the state.

The report made a mention of suspension of World Bank loan in May 1998, following MSEB's failure to improve the recovery of dues from consumers.

MSEB was forced to meet expenditure of Rs 588.71 crore from borrowings and diversion of funds meant for revenue expenditure. MSEB was also deprived of Rs 8.27 crore by way of deemed export benefits.

The report strongly criticised the state government for the loss of Rs 242.89 crore by its two undertakings by September 1999. Of the total 59 state undertakings, total investments in the five statutory corporation was of the order of Rs 13,348.06 crore.