Power Firm Contests Kerala Order

The Supreme Court on Friday asked the Kerala government and the state electricity board to file their replies to the writ petition moved by Kannur Power Project Pvt Ltd.

Earlier, the Kerala High Court had asked the authorities to resolve the dispute over foreign participation in the private power project within three months. Following this, the state government rejected the financial structure of the company. Therefore, it has approached the Supreme Court.

The company had signed a memorandum of understanding with the electricity board in 1995 for setting up a 500 mw combined-cycle power plant in north Kerala, the first time private participation in power generation was attempted in the state.

The state government signed the power purchase agreement and various approvals were granted. But, three years later, the government disagreed with the financial structure proposed with Enron International as co-promoter.

The central government told the Central Electricity Authority (CEA) that according to guidelines, the promoter