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States may get Dabhol power at subsidised price

Renni Abraham

Even though the Dabhol Power Company has reiterated its decision to exit from the project, the Centre in a last-ditch effort is working out a plan to ensure the offtake of around 1,000 mw of power from the second phase of the project by six states at a subsidised price.

A top power ministry official told Business Standard: "Six states are willing to buy around 1,000 mw of power at tariffs averaging between Rs 2.25 and Rs 2.50. The Centre has more or less accepted the fact that it will have to take a hit to ensure that the surplus power available with DPC -- after meeting the Maharashtra State Electricity Board's requirements -- is picked up and paid for. But at the same time, it is keen to keep its financial exposure low," the official said.

He added that a special purpose vehicle would have to be set up to facilitate the offtake by the six states. He emphasised that even if DPC no longer remained in the project, the Centre would still have to work out a solution for ensuring the offtake of power from the 2,144 mw project (phases I and II).

Of the six states, Karnataka had expressed its willingness to buy 300 mw of power at Rs 2.80 per unit, plus wheeling charges. Similarly, Punjab has sought 100 to 150 mw at Rs 2.50 per unit, Delhi says it is willing to pick up 200 mw at Rs 3 per unit and Madhya Pradesh has expressed its interest in buying 200 mw at Rs 1.65 per unit.

Rajasthan and Haryana, which did not participate in the discussions, have in a written proposal sought 300 mw and 100 mw, respectively.

According to the official, recent talks between DPC and the Centre stalled on the price. While DPC offered to bring down the price to Rs 3.50 per unit, the Centre sought power at Rs 3 per unit.

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