Don't retrospectively allow cos to divert coal: Tata Power

Comments come after CAG report says Reliance Power unduly gained Rs 29,000 cr by diverting surplus coal from mines assigned to Sasan project

Tata Power today said developers should not be retrospectively allowed to utilise coal mines allotted for a particular power project for alternative purposes.

The comments came after the CAG in a report said Reliance Power unduly gained over Rs 29,000 crore by diverting surplus coal from mines assigned to its Sasan power project.

"We had clearly stated that this aspect of alternatively using coal from the mines was not there before. If it was there, everyone would have set the tariff accordingly.

"If you want to do it, do it post facto (and) do say that all future projects would have the opportunity to use mines for anything else. Don't do it retrospectively," Tata Power Managing Director Anil Sardana told reporters here.    

The 4,000 Mw Sasan Ultra Mega Power Project (UMPP) was awarded to Reliance Power in August 2007.

Tata Power, which had emerged as the second lowest bidder for Sasan UMPP, has approached the court citing that the government made changes in terms -- based on which -- the tenders for the project were invited.

A high level inter-ministerial panel in April this year had decided not to review the earlier decision allowing Reliance Power to use excess coal from the Sasan UMPP mines for another project.

In August, 2008, an EGoM had given approval for Reliance Power to divert surplus coal from the Sasan blocks for another project in Chitrangi. Both projects are in Madhya Pradesh.

Meanwhile, in a separate report today, CAG said that private companies are likely to accrue a gain of Rs 1.86 lakh crore from allocation of 57 coal blocks without any competitive bidding.

These allocations were made between 2005 and 2009.

Commenting on this report, Sardana said that if it (allocation of blocks without competitive bidding) was wrong, "I am only saying why now".

"I am on record to say since 1998 Tata Power has been applying for mines and at every mine allocation everyone else is found the right allottee and we were not allocated mines.

"I used to ask what is so wrong with Tata Power that we won't get mines and everybody else gets it. I am glad those answers have been found. I am only sad why now. This should have been done much earlier," he said.