Tata Power softens stand on power battle

Offers to supply 200 Mw to R-Infra at the regulated rate till June 30

Tata Power today offered to supply 200 Mw to Reliance Infrastructure (R-Infra) at the regulated rate of Rs 3.70-4.40 per unit till June 30. The company had so far stuck to its stand that it would charge Rs 5.90 per unit for supplying the 200 Mw. Tata Power also suggested to the state government that from July 1, it can supply 200 Mw by taking over 4,00,000 consumers of R-Infra with monthly consumption of less than 100 units. These consumers would pay Tata Power’s applicable rate of Rs 1.30 per unit.

Tata Power’s proposal came at a time when the State Load Despatch Centre (SLDC) turned down its request to schedule 160 Mw, out of the current 360 Mw, to Tata Power Distribution Company from Sunday midnight onwards to cater to its consumers. So, Tata Power’s supply of 360 Mw to R-Infra at the regulated rate continues.

“We are disappointed to note that we have to maintain status quo on 360 Mw power supply to R-Infra. The decision continues to ignore the needs of our consumers who have switched over from R-Infra. It is preferential to one set of Mumbai consumers against the other and supporting an inefficient distributor,” Tata Power said.

A spokesperson at R-Infra said it would study the implementation aspects of the Tata Power proposal.

S Ramakrishnan and S Padmanabhan, executive directors at Tata Power, said the company proposed to give the wheeling charge of 37 paise to R-Infra. The offer would be applicable till March 31 and is subject to the approval of Maharashtra Electricity Regulatory Commission (MERC).

Ramakrishnan said Tata Power’s proposal would reduce R-Infra’s power purchase requirement by 200 Mw. This would also reduce R-Infra’s requirement for cross-subsidy. “Mumbai consumers are protected during the summer. R-Infra secures three more months to procure power for its consumers on a long-term basis,” he added.

Padmanabhan said the company had replied to the state government’s May 14 letter asking it to maintain status quo by continuing the supply of 360 Mw to R-Infra. He said the company had made it clear that there was no cherry picking since consumers switching over to it from R-Infra was taking place in accordance with various orders of the MERC.

Padmanabhan said, “Tata Power cannot be said to be a dominant player in the power generation/supply market. Furthermore, it is not mere dominance that is actionable, but its abuse. If Tata Power exercises its statutory rights to sell its surplus power at a price set by the market mechanisms, there can be no complaint of abusive behavior.”