Deshmukh convenes meet to discuss Dabhol crisis

Sanjay Jog

Mumbai, May 17: Maharashtra Chief Minister Vilasrao Deshmukh has convened a crucial meeting on Saturday with state officials, the Maharashtra State Electricity Board (MSEB), the advocate general and legal experts to take stock of the situation of the ongoing Dabhol crisis.

Mantralaya sources told The Financial Express that the issues relate to renegotiations with Dabhol Power Company (DPC) like the proposed arbitration proceedings, the Centre’s reluctance to purchase Dabhol phase-II power, and issuance of preliminary termination notice to the DPC are likely to to come up prominently at the Saturday’s meeting.

Furthermore, the meeting would also discuss at length the DPC’s refusal to pay rebate of Rs 401-crore charged by MSEB for the mis-declaration and default on the availability of power on January 28. MSEB will complete the review of rebate payment by end of this month and serve another rebate of Rs 400 crore to DPC.
MSEB and state energy department are likely to seek chief minister’s intervention to take up the issue of despatch of Dabhol power from phase-II by the Centre in view of their inability to bear additional burden.

In fact, the state energy department and MSEB were surprised over the recent statement by the union minister of power Suresh Prabhu that neither National Thermal Power Corporation nor Power Trading Corportion are in a position to purchase or trade Dabhol power to other states.

Moreover, the energy department and MSEB were of the view that the Centre, which has provided a Counter Guarantee for Dabhol phase-I, cannot remain as a silent observer, but should bail out the state government and MSEB. The chief minister’s meeting is also likely to discuss the “cold” response from the union ministries of power, finance and oil and petroleum in reaching at an acceptable solution. Ironically, the Centre, which has decided to adopt a conciliatory route, has yet to prepare a reply to the DPC’s notice served on April 4 for the non-payment of December bill of Rs 102 crore.

Sources said that the state government would make a fresh appeal to the Centre to implement a common strategy in defending the stand of MSEB, Centre and state governments at the proposed arbitration proceedings.