Godbole panel empowered to renegotiate with DPC

Godbole panel empowered to renegotiate with DPC
EXPRESS NEWS SERVICE

MUMBAI, MARCH 9: In a major policy decision, the Congress-led Democratic Front government today empowered the high-level Godbole Committee to renegotiate with the Dabhol Power Company on the power tariff as well as capital cost.

Chief Minister Vilasrao Deshmukh said his government had amended the terms of reference of the Godbole Committee so that it could renegotiate with DPC on behalf of the state government as well as the Maharashtra State Electricity Board (MSEB) for reduction in power tariff and capital cost.

Stating that the Godbole committee has been given an extension of month's time, Deshmukh said its terms of reference had been expanded. Besides renegotiations with DPC, the committee will also recommend on the measures to be taken to meet the demand for power in next ten years, measures for improving financial condition of the MSEB and review all documents pertaining to the Dabhol power project.

On the fresh notice for invoking the counter guarantee by the DPC, Deshmukh said, it was the responsibility of the MSEB to make the payment to the DPC. ``We have already informed MSEB that we are not in a position to release funds to it for payment to DPC. Simultaneously, I have taken it up with the Prime Minister. Even during the conference of Energy Ministers, I made it clear that we cannot afford the second phase of the project. Under such circumstances, it was the responsibility of the Centre to tackle the situation,'' Deshmukh said.

Deshmukh said the cabinet also approved the draft of the Memorandum of Understanding to be singed with the Centre on the accelerated power development programme. During the one-day conference of power ministers, the Centre had proposed the ambitious programme and had asked state governments to sign the MoU, if they were keen for the project. ``We examined the programme and gave consent. However, we have suggested certain changes in the draft MoU,'' he said.

As per the MoU, it will be binding on the state government to take immediate measures for further reforms in the power generation programme, reduce the transmission losses from 34 per cent to 18 per cent, management of power distribution and provide provide financial assistance to the MSEB if the tariff recommended by the State Electricity Regulatory Commission was altered for the benefit of one or the other consumers.

Deshmukh said, if the MoU was signed, the Centre would provide additional power to the state. In addition, the state will be entitled for financial assistance for the Parli, Paras, Bhusaval and Uran power projects. ``If we signed the MoU, then we will get Rs 135 crore before March 31,'' Deshmukh added.