NTPC seeks support of Rs 16,000 crore
By James Paul | 25 Mar 2002
Kochi: National Thermal Power Corporation (NTPC) has decided to cut the supply of power from its stations to Kerala, as the Kerala State Electricity Board (KSEB) has failed to clear its bills.
The average supply of power from various NTPC stations to the state during the last quarter was 286.365 million units per month. The plan now is to reduce this to 75 million units per month. It goes without saying that this will force the state to go in for drastic power cuts.
NTPC, on 7 March 2002, sent a letter to the southern region load despatch centre in Bangalore, giving a detailed programme for regulating the supply of power from its stations of the KSEB. Accordingly, 245mw of power the KSEB is receiving from the Ramagundam and eastern region power stations of NTPC will be diverted to Tamil Nadu, Karnataka and Pondicherry.
The regulation in power supply will start any day now. NTPC in fact had given a long rope to the KSEB in settling the issue of pending payment, and now its is resorting to " the drastic measure of cutting the power supply only due to the indifferent response from the state government," sources said.
The KSEB’s outstanding dues with NTPC came to Rs 956.90 crore as on 31 December 2001. In early January 2002, NTPC wrote to the KSEB warning that it will have to regulate power supply to the state unless the issue of mounting arrears in payment is not settled without delay.
When a similar situation came up a year ago, the KSEB had agreed to liquidate all outstanding dues as on 31 January 2001, and issued bonds worth Rs 328 crore in favour of NTPC. In an agreement reached between the state government, it was decided that the KSEB will pay NTPC not less than Rs 42 crore monthly bills till a revision in power tariff was implemented.
The KSEB, as per this agreement, was further required to issue additional bonds at the end of each quarter, starting February 2001, to make up the quarterly deficit in payments. Since then, against the payment of Rs 42 crore being made by the KSEB each month, NTPC had been supplying power worth around Rs 85 crore.
Due to non-issuance of the promised bonds and the deficit in monthly payments during the last one year, the KSEB’s outstanding dues with NTPC went up to Rs 956.90 crore at the end of 2001. In addition to this amount, the KSEB owes NTPC Rs 170 crore towards interests on bonds issued earlier.