Maharashtra is currently facing a power shortage of around 5,000 Mw. The Dabhol plant, taken over by RGPPL in 2005 from the now-defunct Dabhol Power Company (DPC), was expected to be fully operational by 2006.
However, thanks to non-availability of gas, frequent breakdowns and dispute with equipment supplier General Electric over repairs and maintenance contract, the plant has not become fully functional so far and now, according to the revised schedule, it is expected to generate 1,900 Mw by April 2009.
A senior official from the state government's energy ministry said: "We intend to make a formal proposal to this effect in the next meeting of the empowered group of ministers (EGoM) headed by Pranab Mukherjee."
"We are contemplating various options to gain control over RGPPL in the interests of the project and the state. A feeling has been on the rise in the top echelons of the Maharashtra government that the amount of interest being shown by the promoters of RGPPL to smoothly run the project is not according to the state's expectations. But efficiency of this project is of utmost importance to Maharashtra and the state needs more control over RGPPL to ensure this," the official said.
The proposal has strong political backing at the state level and in Delhi too, with Chief Minister Vilasrao Deshmukh, State Energy Minister Dilip Walse Patil, Union Agriculture Minister Sharad Pawar and Union Power Minister Sushilkumar Shinde reportedly supporting the move.
Under the current arrangement, NTPC and GAIL, which have 28.33 per cent stake each in RGPPL, have the right to appoint the chairman and managing director of the entity in rotation. The Maharashtra government, which owns 15 per cent stake in RGPPL through Maharashtra State Electricity Board Holding Company, has the right to appoint two directors. The rest of the stake is owned by financial institutions, the official pointed out.
"Though we have the right to appoint two directors, we don't have same control over the matters of the company, while for NTPC and GAIL, this is one of the many projects or subsidiaries they own all over the country. Therefore, the same sense of urgency is not shown by the management of these companies with regards to the matters concerning RGPPL," the official said.
Whether it is an issue of tying up gas for the project, getting finance or holding talks with GE for maintenance and repairs contract, it is the Maharashtra government officials and political leaders who run around, the official pointed out. After Power Finance Corporation (PFC) refused to give a loan of Rs 300 crore (Rs 3 billion) required for repairs and purchase of spares, as its exposure to RGPPL had reached limits, the Maharashtra government had to step in and give the loan guarantee.
"However, our initiative has limits as the post of chairman and managing director is not with us. Therefore, we want to formalise our arrangement with RGPPL by having the right to appoint the chairman and managing director," the official said.
"Like everybody else, since we too are facing a liquidity crunch, we are not looking at increasing our stake in RGPPL at this stage," he added.