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Home KSEB Strong Opposition - Renewal of KSEB-BSES power purchase deal stuck

Strong Opposition - Renewal of KSEB-BSES power purchase deal stuck

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Suresh Kumar MGA proposal to renew the power purchase agreement (PPA) between Kerala State Electricity Board (KSEB) and privately-run power plant BSES Kochi Pvt Ltd (BKPL) is stuck, with the two entities disagreeing on key issues, including the price of electricity. Meanwhile  power sector trade unions and organisations representing the public stridently opposed the renewal at a hearing held by the State Electricity Regulatory Commission.

The KSEB informed the commission that it cannot file a draft PPA as it had differences of opinion with BKPL on at least eight points, including fixed charges and land lease charges. BKPL, on its part, wanted the regulatory commission to fix the price and allow an interim extension of two years on a 15-year PPA which had expired on October 31 last year. Commission chairman T M Manoharan said the commission would entertain only a PPA agreed upon by both parties.

Although the KSEB board and the State Government had given in-principle nod for an extension of two years, differences are yet to be sorted out. While KSEB has proposed 29 paise per unit as fixed charge, BKPL wants it to be fixed at 39 paise for the first year and 40 paise for the second year.

The KSEB Officers' Association (KSEBOA), the Kerala High Tension/Extra High Tension Industrial Electricity Consumers' Association, the Kerala Electricity Workers' Federation (AITUC) and the Centre for Consumer Education stiffly objected to the renewal calling it harmful to the KSEB, the employees of the KSEB and the general public.

A public tender should be floated for the purchase of cheaper power rather than allowing the KSEB to unilaterally sign a PPA with BKPL, the KSEBOA said. The electricity generated at the naphtha-fuelled BKPL came at a high cost. The state did not face a power crisis which forced it to bank on such expensive power, KSEBOA general secretary Suresh Kumar M G said.

Dijo Kappen of the Centre for Consumer Education said there were no grounds for renewing the PPA as the State Government did not have a stake in the power plant anymore. The Kerala High Tension/Extra High Tension Industrial Electricity Consumers' Association opposed the renewal, saying it would place a heavy burden on the consumers.

''What the current KSEB proposal amounts to is that it will be paying BKPL Rs 32.70 crore annually as fixed charges whether or not electricity is purchased. The BKPL proposal will entail a payment of Rs 43.06 crore and Rs 44.77 crore in and first and second years respectively,'' A R Satheesh, vice-president, Kerala HT/EHT Industrial Electricity Consumers' Association, said.

Source- Indian Express



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