Tata Power Company could face Maharashtra govt’s wrath

Tata Power Company’s (TPC) decision to withdraw supply of 360MW from Monday unless Reliance Infrastructure (RInfra) purchases 200MW at a high rate of Rs5.90 per unit, on Friday, saw the state government sending a warning of sorts to TPC against implementing the decision.

In a letter reflecting a conciliatory tone, the state energy department asked TPC to suggest an alternative way to resolve the dispute in the interest of consumers. But, till the matter does not reach a reasonable conclusion, the department said they expect TPC to continue supplying power to RInfra.

Though the government has not invoked section 11 of the Electricity Act, 2003 and directed TPC to supply 360MW power to RInfra, senior officials said they would be well within their rights.
“We have sent them our advice in writing. These are extraordinary circumstances. Not just the country, even the state is reeling under power shortage. So, we have requested TPC not to precipitate the issue and instead supply power in the interest of consumers,” a senior officer said.

TPC officials refused to comment as they still have to receive the government’s letter.

The officials, however, believed that the government will err if they direct them to supply power to RInfra in light of Union Power Minister Sushil Kumar Shinde’s advice to state governments to judiciously use section 11.

“In fact, we believe the union government is seeking to amend the act and further curtail this right. The section can only be used in extraordinary circumstances. What is extraordinary in this dispute with R-Infra, who we believe is a perpetual litigant?” asked a senior TPC official, adding they have kept their legal options open.

“This dispute is about a commercial transaction. Extraordinary circumstances mean power shortage as crippling as that faced in the rest of Maharashtra. Mumbai has got adequate power. RInfra is crying about load-shedding because having failed to make alternate arrangements, they will have to purchase power at a high rate. As it will affect their consumer base, R-Infra is unnecessarily creating fears of load-shedding,” the official added.

Meanwhile, till the time of going to press, RInfra had still not responded to TPC’s offer regarding the purchase of 200MW power.

However, in event of the government failing to resolve the dispute, RInfra consumers will have to shell out Rs1.20 extra per unit.