CERC threatens to take action against RGPPL, MahaVitaran

Written by Sanjay Jog | Mumbai | Updated: Dec 15 2008, 05:40am hrs
The ongoing Dabhol project saga has taken a new twist as the Central Electricity Regulatory Commission (CERC) has indicated that it will initiate action under section 142 of the CERC against the Ratnagiri Gas & Power Pvt Ltd (RGPPL) and Maharashtra State Electricity Distribution Co Ltd (MahaVitaran) for non-compliance.

Section 142 envisages penalty of not exceeding Rs1 lakh. RGPPL, which possesses the troubled 2,150 mw Dabhol power project since October 2005, sells power at Rs3.01 per unit to MahaVitaran according to power purchase agreements (PPA). CERC is yet to clear the Dabhol power tariff, as RGPPL and MahaVitaran were unable to file necessary details in this regard.

CERC's move comes at a time when the lenders to the Dabhol project have been strongly demanding that the present tariff of Rs 3.01 be increased at least by 70 paise to make up for the increased revival cost to over Rs 12,500 crore from Rs 10,030 crore. Besides, the empowered group of ministers (EGoM) is yet to take a decision in this regard as the tariff hike has been vehemently opposed by MahaVitaran while other equity holders, NTPC and GAIL India, want that lenders should bear the additional revival cost.

RGPPL and MahaVitaran had approached CERC in 2007 for approval of the tariff. However, RGPPL stated that single-part tariff was being charged provisionally, in terms of the CERC's order of October 1, 2007. CERC pointed out that permission was granted to bill the MahaVitaran provisionally, based on power purchase agreements, till the submission of additional information and completion of all formalities by the generating station. Subsequently, MahaVitaran sought three weeks time to file its response to the interlocutory application filed by RGPPL.

However, CERC at its hearing last week expressed its displeasure as RGPPL and MahaVitaran had not submitted the complete information. CERC chairman Pramod Deo told FE on Sunday, RGPPL and MahaVitaran have been asked to file the required details in the prescribed format, in terms of the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2004, failing which, necessary action as considered appropriate will be initiated against the petitioners, under Section 142 of the Electricity Act,2003 .

Section 142 reads : In case any complaint is filed before the Appropriate Commission by any person or if that Commission is satisfied that any person has contravened any provisions of this Act or rules or regulations made there under, or any direction issued by the Commission, the Appropriate Commission may after giving such person an opportunity of being heard in the matter, by order in writing, direct that, without prejudice to any other penalty to which he may be liable under this Act, such person shall pay, by way of penalty, which shall not exceed one lakh rupees for each contravention and in case of a continuing failure with an additional penalty which may extend to six thousand rupees for every day during which the failure continues after contravention of the first such direction.