Chhattisgarh offers power rebate to ailing steel units, industry wants more

They want sponge units and rolling mills to be included; they also want a higher rebate than the 80 paise per unit currently being offered

In a move aimed at providing a breather to the ailing steel sector in the mineral-rich state, the Chhattisgarh government had decided to offer a rebate on power tariff to specific units.

As per the decision of the state government, mini steel plants operating captive power plant (CPP) of up to one Mw would be eligible for a rebate of 80 paise per unit of power consumed. “The relief will be effective April 1, 2019 till March 31, 2020,” a state government spokesperson said.

The relief will be of little help, claimed industrialists. “The rebate would be only for steel units, while there are a large number of sponge and rolling mills in the state,” said Anil Nachrani, former President of Chhattisgarh Sponge Iron Industry Association. Keeping sponge iron and rolling mills out of the ambit of relief will not help the sector overall, he added.

Moreover, the cap of 1-Mw CPP to claim the relief would cover only 70 per cent of the state's steel plants. Even the rebate of 80 paise per unit isn't big enough to help the secondary steel sector that has been reeling under a severe crisis. “The actual relief is just 45 paise (per unit) as the state government has recently hiked the power tariff for industry by 35 paise per unit,” Nachrani said.

The steel sector in Chhattisgarh has been demanding that power tariff for industry be curtailed from Rs 6 per unit to Rs 4, claiming that the tariff is lower in neighbouring states.