Open Sky policy shut down

| 21 August 1998 10:22 IST

Dr Wilfred de Souza's coalition government is planning to close the open sky policy of power privatisation, denying access to all the pending proposals of private power generators.

The reason however is not to disown the policy of its predecessors, the Congress, but the tough stand adopted by the International Finance Corporation, who is presently working on state's privatised power transmission and distribution policy.

Though the Congress government had officially announced the open sky policy around six months ago to generate and sell the power directly to the consumers, it directly contradicts with the IFC proposal, which has also been officially accepted by the government in June.

The British consultancy firm reportedly offered to withdraw from the scene if the Congress government goes ahead with its open sky policy while also agreeing to the IFC's proposal, to be implemented by next year.

As a result, the government last month held back the letter of permission prepared for the Reliance Salgaoncar Pvt Ltd, allowing them to generate and sell additional 100 MW of power directly to the industries. Its 50 MW project, as per the PPA signed two year ago, would be commissioned next month.

The power ministry was also sitting over two more proposals, which the private firms had worked out in consultation with the industries to supply around 100 MW to them, who are suffering heavy losses due to acute power shortage in the state.

The IFC, in order to revive the whole power scenario in the tourist state, has suggested a centralised private power distribution firm, whom the private generators would sell its power to. They have also suggested energy tax to different class of consumers including the industries.

According to Rakesh Mehta, the power secretary, the proposal was directly clashing with the open sky policy since the regulatory authority, to be appointed by next month, would have had tough time in fixing the tariff structure if the private generators had signed the PPA with the industries.

"We may now revive the old system of purchasing power from the private generators by signing the PPAs till the central private distribution firm takes over", says power secretary Rakesh Mehta. Instead of scrapping it, he proposes to amend the open sky policy, but by inviting competitive bids.

Meanwhile, in order to control the worsening power situation in the tourist state, the government at its first cabinet meeting has decided to scrap provisional registration of 38 power guzzling units including Ferro alloy and steel rolling mills, who required additional 105 MW of power.

Goa, which gets only 210 MW of power from the NTPC, was pushed into acute power crisis by allowing 93 power guzzlers in the state in last five years, putting additional burden of 268 MW. This obviously resulted into load shedding and uninterrupted power shut downs.

Twenty such units are already consuming 65 MW while 35 more units have been promised to supply 98 MW. But de Souza has now decided to allow the second batch of power guzzlers, depending upon the availability of power, provided they agree with load shedding.

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