M A I N   N E W S

Panel to rework pact with Enron

New Delhi: Union Finance Minister Yashwant Sinha, his cabinet colleague Power Minister Suresh Prabhu and Maharashtra Chief Minister Vilas Rao Deshmukh going to attend a meeting on Enron project at North Block in New Delhi on Monday. — PTI photo

New Delhi, April 23
Maharashtra will constitute a high-level negotiating committee to rework the Power Purchase Agreement (PPA) with US energy giant Enron-promoted Dabhol Power Company (DPC), to which the Centre would also nominate a representative.

“We have decided that the Government of Maharashtra will constitute a negotiating committee to negotiate issues like cost of power and use of power with the DPC,” Union Finance Minister Yashwant Sinha told reporters after nearly an hour-long meeting with Maharashtra Chief Minister Vilasrao Deshmukh and Union Power Minister Suresh Prabhu.

The committee, comprising representatives of the Centre, state government and the Maharashtra State Electricity Board (MSEB), Mr Sinha said, would be constituted in a week’s time as the second phase of the 1444 MW of the DPC was nearing completion.

“We hope the DPC will respond positively to this and they do not take steps that will precipitate a crisis,” the minister said.

On the Godbole Committee report, Mr Sinha said its recommendations would form an important input to the committee’s deliberations with the DPC.

While admitting that the cost of power supplied by the DPC was too high, he said, “We have to look if the state can use all the power generated and that if the excess power can be wheeled out to the needy states.”

Mr Deshmukh said the Centre’s response was positive to the state’s demand for renegotiating PPA with the DPC. Asked what should be the ideal cost of power, Mr Deshmukh said it should be between Rs 2.80 to Rs 3 a unit as against the present cost of around Rs 7 a unit.

He said all four parties, namely the state, Union Government, Enron and MSEB, should come together for negotiations, otherwise it cannot be a complete exercise.

The DPC has already slapped one conciliation notice on the Centre and three arbitration notices on the state government over the non-payment of dues amounting to Rs 213 crore plus interest towards the bills due for the months of December, 2000, and January, 2001.

Today’s meeting was also attended by National Congress Party President Sharad Pawar, who accompanied Mr Deshmukh for meetings with Mr Sinha and Mr Prabhu on the Enron issue.

Mr Deshmukh’s meeting with Mr Sinha assumes significance as the DPC’s board would be meeting in London on April 25 to decide on the future of the controversy-marred 2,184-MW project in Dabhol. Maharashtra’s Energy Secretary would be attending the meeting in London.

Maharashtra, which has 30 per cent stake in the 740-MW phase I of Dabhol power project, has not expressed any interest in taking the stake in the second phase of the project. PTI