Power cost may drop after coal import probe

Mumbai: A probe into the Rs 29,000-crore coal import scam, where the value of coal from Indonesia for power plants was allegedly inflated by companies, seems set to lower electricity tariff in several states, including Maharashtra. At least four state electricity regulatory commissions — Maharashtra, West Bengal, Andhra Pradesh and Tamil Nadu — have written to the Directorate of Revenue Intelligence (DRI) seeking details of the probe. “We have had discussions with the DRI and have requested for a detailed report on the over-invoicing of power plant equipment, besides inflating the value of coal. This will have an impact on the tariff pertaining to power plants under our jurisdiction in Maharashtra,” said a senior MERC official.

The DRI estimates that tariff could come down by 50 paise to Rs 1.50 per unit. It has referred the case to the “Forum of Regulators" comprising chairpersons of the Central Electricity Regulatory Commission (CERC) and all the state monitors.

The DRI has alleged that power-generating companies, including public sector undertakings like Tamil Nadu Electricity Board, NTPC, Mahagenco, and others have indulged in over-invoicing of the imported coal. TOI was the first to report the scam in December 2014. All the companies have denied any manipulation.

The DRI findings have also reached the Supreme Court as part of an appeal. Energy Watchdog, represented by senior lawyer Prashant Bhushan, has challenged an order of the Appellate Tribunal for Electricity that directed the CERC to award compensatory tariffs to Adani Power and Coastal Gujarat Power (Tata Group) based on the power purchase agreements for their power plants in Mundra.

The compensatory tariff is linked to the increase in coal prices owing to a change in Indonesian laws, thereby leading to hike in the import prices. DRI has alleged that it is not true. At least 20-odd applications seeking compensatory tariff are pending before CERC and the various SERCs.