Bid to tighten power grid premature, Jayalalithaa tells PM

Tamil Nadu chief minister J Jayalalithaa on Sunday wrote to Prime Minister Manmohan Singh opposing the Central Electricity Authority proposal to tighten the national electricity grid's frequency bandwidth. She said the move is premature, and would raise the 'unscheduled interchange' charges, putting extra costs on the Tamil Nadu Generation and Distribution Corporation, which is already facing a debt crisis.

Jayalalithaa urged the prime minister to advise the authorities to defer the proposal till the demand-supply situation and inter-state connectivity in the country improve. She said the proposal, aimed at ensuring the grid stability, was ''unwarranted'' when grid stability had not been adversely affected in the recent past with the existing frequency bandwidth; and in view of the prevailing power shortage situation in the country.

She said the operating frequency bandwidth is proposed to be restricted further from the current 49.5 Hz-50.2 Hz to 49.7-50.2 Hz, which is needless at present. She added that the unscheduled interchange (UI) charges, which are proposed to be raised from Rs8.73 per unit to Rs9 per unit at the minimum frequency of operation, would become excessive.

''The cost of power drawn at frequency below the set level would further increase the cost of power to the utility,'' she said.

She said the move would subject TANGEDCO, the new avatar of the Tamil Nadu Electricity Board, an added cost of Rs350 crore every year. Besides, ''this may result in increasing the duration of enforced load shedding in Tamil Nadu causing irreparable loss to consumers, particularly in rural areas, which may adversely affect agricultural production and the economic growth of the state,'' she said.

Like most of India, Tamil Nadu faces a perpetual power shortage - a problem that could be glossed over the days of low industrial activity and economic growth; but now threatens to derail India's ambitions of becoming an economic powerhouse.

'CST compensation cut arbitrary'
In her letter to the prime minister, Jayalalithaa joined West Bengal chief minister Mamata Banerjee (whose Trinamool Congress is a member of the union coalition) in slamming the centre for its "arbitrary" action in reducing Central Sales Tax (CST) compensation to states by linking it with VAT rate revision.

Though the Centre had agreed to compensate states for the revenue loss for 2010-11 also, the eligible compensation was "arbitrarily restricted" by deducting additional revenue realised through revision of VAT rate from four to five per cent, she said in her communique to Manmohan Singh.