20 April 2007
Critics of project question the need for the proposed plant
CHENNAI: The 1,320-megawatt coal-based thermal power project in Cuddalore was subjected to a critical scrutiny at a public hearing organised by the Tamil Nadu Electricity Regulatory Commission in Chennai on Wednesday.
Presided by the TNERC chairperson S. Kabilan, the hearing was a sequel to the Cuddalore Power Company’s application to the Commission for sale of power from the project. In February, the State Advisory Committee discussed the matter.
Making their case on the grounds of cost and environmental protection, critics of the project including labour unions and environmental groups questioned the need for the proposed plant. The project was unnecessary as the Board would have sufficient power at its disposal and it would not be able to bear the cost in view of the Tamil Nadu Electricity Board (TNEB)’s “precarious” financial condition.
S.S. Subramanian, general secretary of the Central Organisation of Tamil Nadu Electricity Employees, said in the event of the project being given the status of a mega power project, the power distribution in urban areas with a population of one million would have to be privatised. Such private power projects would erode the finances of the Board.
S. Gandhi, president of the Power Engineer’s Society of Tamil Nadu, wanted the agreement to be amended to make the cost reasonable. He urged the Board to invest funds in its Basin Bridge plant instead of purchasing costlier power. V. Ashok Kumar, general secretary of the TNEB Engineers’ Sangam, said even now the Board was drawing not more than one-third of power generated by independent power producers as the rate was costlier. Sheweta Narayan, coordinator, Community Environment Monitors, said there had been growing resistance in Cuddalore to the establishment of any polluting or water intensive industry there.
Responding to the issues, proponents including the TNEB and the private promoter defended the project. The project was not a costly one and it was based on a “legally-valid” power purchase agreement (PPA).
S. Kathiresan, Member (Accounts) of the Board, which signed the PPA with the private project promoter, said the TNEB ensured that the clauses safeguarding the financial interests of the Board had been incorporated in the agreement. At the end of the 11th Plan period (2012), the State would have a deficit of 735 megawatt, after taking into account different projects proposed by the Board and the Central Government’s utilities apart from many joint venture schemes and the Cuddalore project.
Agreeing that the Board paid Rs. 1,006 crore annually to the independent power producers for purchase of power, Mr. Kathiresan said an analysis of the Cuddalore project from different angles revealed that the power to be produced from the proposed plant would be cheaper.