Godbole-DPC meet advanced to
June 19
BS Bureau
The meeting between the Madhav Godbole renegotiating committee and the Enron-promoted Dabhol Power Company has been advanced to June 19 from June 30.
This has been done in the wake of the Bombay high court's June 12 order directing DPC and the Maharashtra State Electricity Board to try and find an amicable solution to the vexed problem of the high tariffs charged by the Enron-promoted company.
MSEB sources said the meeting will be coordinated by former Union power secretary, E A S Sarma as the committee chairman Madhav Godbole is abroad and will not be able to attend the meeting. The Union government's nominee A V Gokak too will be present at the meeting.
The other members of the panel include MSEB chairman Vinay Bansal and Maharashtra energy secretary V M Lal.
The two sides have also been feuding on the jurisdiction of the state power regulator Maharashtra Electricity Regulatory Commission to resolve various issues pertaining to arbitration. MSEB has been contending that MERC is the right forum while DPC moved the Bombay high court on June 11 contesting this.
A division bench of the Bombay High Court consisting of justice A P Shah and justice S A Bobde had ruled that the two parties first try to find an amicable solution first outside the court. The next hearing on the issue is slated for June 21.
Meanwhile on Friday, DPC at a meeting with MSEB, the state government officials and domestic and foreign lenders requested the state electricity board to buy power from its 740 MW first phase again.
MSEB had rescinded the PPA and stopped purchasing DPC power from May 29 in retaliation to the preliminary termination notice served by the independent power company.
MSEB has taken then line that it will have to look at the legal implications of buying power again as it has already rescinded the PPA.
DPC has also informed MSEB that it was prepared to accept the April and May bills. MSEB officials said the bills should be adjusted against a penalty of Rs 3 billion that it had slapped on DPC for not supplying power on time.
At the meeting, lenders too tried to impress upon MSEB the necessity of accepting DPC's request to supply power.
R S Agarwal, executive director, Industrial Development Bank of India said, "There is room for arriving at an amicable solution. MSEB has to look at the request made by DPC in a positive light. At the same time, it should be at a reasonable price."
MSEB and state government officials made the point that the final solution to the vexed problem lies with the Central government taking a proactive stand.
MSEB may not accept DPC's request
The Maharashtra State Electricity Board may not accept Enron-promoted Dabhol Power Company's request for resumption of power offtake, nor pay its bills due to the US multinational.
"The Bombay high court has asked both parties to settle the dispute amicably. We are not interested in such piece-meal solutions...A concrete and final decision has to be arrived at by all the concerned parties including the Centre", MSEB sources said.
They said the issue was not of resumption of power and payment of the due bills, but, once MSEB goes back to the earlier arrangement with DPC, history would repeat itself and no solution would be in sight.
"We are doing very well for ourselves without DPC power and thanks to this monsoon, MSEB's hydro capacity seems to be promising", sources said adding that in such a case the board would no longer need the US energy major's 'costly' power.
MSEB had stopped drawing power from DPC since May 29. Two days ago, in a major volte-face DPC had urged MSEB to resume power offtake from its $3 billion project and had also expressed readiness to accept the loss-making board's recent payments of Rs 1.34 billion for April and Rs 1.40 billion for may, made "under protest" without any pre-conditions.
DPC president Neil McGregor along with representatives of the multinational's lenders, both domestic and foreign, had met MSEB chief Vinay Bansal and tried to persuade the board to commence drawing power from the project's 740 mw phase one.
MSEB officials told McGregor and lenders that payments for April and May were already adjusted in the Rs 12-billion claim made by the board in its petition filed against DPC at the Maharashtra Electricity Regulatory Commission.
With reference to drawing of power, Bansal made it clear to the US energy major that as per the commission's order, the board would have to buy "costly" power as a last alternative.
MSEB sources said both the board and the state government were not in favour of taking any changes in this imbroglio as DPC has already slapped several notices including preliminary termination notice, political force majeure, arbitration and conciliation, the board would seek legal implications before taking any steps.
"MSEB in its letter, that rescinded the power purchase agreement, had communicated to DPC that despite the non-recognition of the agreement, the board is ready to take required power and also pay for the same," sources said.
With reference to progress of international arbitration procedure between the two estranged partners, they said DPC representative Andrew Rogers and MSEB nominee M L Pendse were yet to decide on the third arbitrator.
"Actually, it is good that we are getting time to chalk out our strategy to be presented before the high court and also save some foreign exchange at the same time," MSEB sources added.
With inputs from PTI
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