Hopes for revival of DPC brighten

The draft which is being jointly prepared by state energy department and MSEB officials also demands that a new power purchase agreement (PPA) would have to signed with the ‘power producer’ who could be any authority that operates or owns the plant.

It also makes the loss-making board’s stand crystal clear that it will by no means associate itself with the incomplete 1,444 mw pahse two of the project.

“Almost a year ago MSEB rescinded its PPA with DPC. So a new PPA is mandatory, which would of course be placed before the Maharashtra Electricity Regulatory Commission for approval and then after completion of public hearings and other legal formalities the offtake from phase one would begin”, the official said.

The state cabinet was likely to give its consent for the draft that would then be finalised and later presented to IDBI, the official said.

According to the draft, the Rs 2.50 per unit price is based on several practical factors like the board’s diminishing financial health and it’s inability to pay higher tariffs. Moreover, it buys power from another private utility Tata Power Company at approximately the same rate. The Godbole Panel too had suggested the equivalent rate and finally it has MERC’s approval to buy power at this price level.

Unlike its earlier one-sided PPA which weighed heavily in favour of the $3 billion project, MSEB has said the new agreement will not have any dollar-rupee linkages, no fixed charges (the loss-making board used to pay Rs 95 crore to DPC as fixed charges with or without offtake of power) and not even a take or pay clauses.

“In order to make the deal commercially viable, MSEB will pay an annual Rs 185-187 crore as energy or capacity charges to DPC’s power producer, the official said.

IDBI, which is overlooking the sale of DPC to seven prospective bidders, has held several discussions with the state government persuading it to restart MSEB’s offtake of power from the plant which has been lying idle since May 29 last year.

Last week, IDBI executive director A K Doda held closed-door meetings with state chief secretary V Ranganathan, energy secretary and acting MSEB chairman Ravi Buddhiraja and key MSEB official seeking the government’s help to restart the phase one of the project.