Letters: Power relations

This refers to the editorial "A worrying precedent" (April 5). The reason for seeking a power tariff revision was the ostensible plea that imported coal prices have gone up. Consider this: Australian coal prices have fallen by 24 per cent - from $111.5 a tonne a year ago to $91.65 a tonne now. Indonesian coal prices have fallen from $94.75 a tonne to $72.25 a tonne in the same period - a 23 per cent fall. The reason for the decline in coal prices in Australia and Indonesia are attributed to poor demand from China and India and their improved supply positions. In this light, it's intriguing if there's an actual reason for the power tariff revision. The sanctity of long-term power purchase agreements is meaningless, if tariffs are revised without valid reasons. Going by analytical realism, it seems there is no realisation on the part of policy makers that reduced coal prices should be translated into lower power tariffs. This should also put Coal India Ltd on notice that it cannot exploit consumers of coal by virtue of its monopoly.

M M Gurbaxani Bangalore

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