Assam power projects suspended for failing to follow policy needs: CAG

The Comptroller and Auditor General (CAG) on Monday said five small hydro power projects in Assam had to be abandoned or suspended due to non-adherence of statutory and policy requirements in project execution.

It also pointed to delay ranging from six to nine years in commissioning of two other power projects.

The observations were made in the CAG report on state public sector enterprises for the year 2021-2022, which was laid in the state Assembly on the first day of the autumn session.

The report said Assam Power General Corporation Ltd (APGCL) had three operational power plants with installed capacity of 361.70 MW.

Out of the capacity addition of 371.66 MW (five projects) planned during 2017-22, APGCL could commission only three projects (181.66 MW).

Of these three projects, only the Lakwa Replacement Power Project was commissioned on time, while Namrup Replacement Power Project (NRPP) and Myntriang Small Hydro Electric Project were commissioned with a delay of six and nine years, respectively.

The NRPP, which was partly financed through interest bearing loan, was delayed mainly due to poor performance of the contractor, Bharat Heavy Electricals Ltd, and APGCL had to bear additional interest liability of Rs 183.50 crore on account of the delay, the CAG report said.

The government of Assam had also taken up six small hydro power projects from May 2010 to May 2013 through an agreement signed with a private developer, Infrastructure Lease and Financial Services.

The private developer was roped in instead of declaring APGCL as the nodal agency for the work contrary to the stipulations made in the state's Small Hydropower Development Policy, the report said.

It added that only one project (Champamati) was completed till date (June 2022) as the state government and developers did not follow statutory and policy requirements in project execution resulting in abandonment/ suspension of the other five hydro power projects'.

The CAG report also said the APGCL invested amounts ranging from Rs 1 crore to Rs 290.32 crore in various banks without inviting any quotations.

An aggregate amount of Rs 293 crore was invested (April 2017 to December 2021) in short term deposits (STDs) offering lower returns ranging between 0.05 and 2.35 per cent with reference to the available interest rates.

Similarly, an aggregate amount of Rs 390 crore was invested (April 2017 to March 2021) in STDs carrying lower interest rate although there were nationalized banks offering higher rates.

"This had resulted in forego of interest amounting to Rs 2.44 crore," the report said.