In a shocking move, the state government has set up a committee to waive off over Rs 2,500 crore owed by the Mula Pravara Electrical Cooperative Society (MPECS) to state run power distributor MSEDCL. Mula Pravara is run by the family of Radhakrishna Vikhe-Patil, the leader of opposition in state assembly. The committee's brief is not only to waive off the dues but to explore the possibility of giving grants to Mula Pravara and supplying it power at subsidized rate. If the government waives off the dues it will lead to indirect increase in tariff in the long run.
Energy minister Chandrashekhar Bawankule however, denied these facts and said that the committee was only for finding a way to pay salaries of Mula Pravara employees. "The society has not paid them since months," he claimed.
The decision has shocked many MSEDCL officials as the Congress-NCP government had asked MSEDCL to take over Mula Pravara following its failure to pay dues to the distributor. It is the BJP-Shiv Sena government that is trying to bail out the cooperative society. Mula Pravara is MSEDCL's biggest defaulter. The total arrears owed by consumers to MSEDCL are over Rs 17,000 crore of which Rs 2,500 crore is owed by the cooperative society alone.
MSEDCL had taken over Mula Pravara licensee area in February 2011 when the dues reached Rs 2,359 crore. MSEDCL also filed a petition in Shrirampur civil court to recover the dues. The Vikhe-Patil family filed petitions in Appellate Tribunal for Electricity (ATE) and Supreme Court and got partial relief. A petition is being heard by the Maharashtra Electricity Regulatory Commission (MERC) in this regard.
The four-member committee is headed by principal secretary (energy) Mukesh Khullar. Principal secretary (financial reforms), cooperation commissioner and chief electrical inspector are the other members.
A MSEDCL official said that a meeting was held in Mantralaya on February 23 to discuss the Mula Pravara issue. Radhakrishna Vikhe-Patil and office-bearers of the society were present. The society raised nine demands and the government agreed to form a committee on look into them. The main demand is waiving off dues and converting them to regulatory assets. This means MSEDCL will bear this loss but offset it by improving its performance. MSEDCL has so far failed to improve its performance and give any relief to consumers in power tariff.