Column: Is BSES really the culprit?

Feb 05 2014, 04:35 IST
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SummaryDelhi’s power face off depends on whether DERC has got its maths right and BSES is owed Rs 14,800 crore

Given the agitation from which it was born, as well as its relative youth, it is difficult to separate the Aam Aadmi Party from its government in Delhi. While the government has, for instance, just asked the Delhi Electricity Regulatory Commission (DERC) to prepare to suspend the licenses of both BYPL and BRPL for talking of stopping power supplies to parts of the capital, and to prepare to appoint Administrative

Officers to run them, an AAP founder member Madhuresh Lakhaiyar has filed a public interest litigation against the DERC in the Delhi High Court. The petition accuses the DERC of colluding with the power companies—he includes NDPL in it as well, presumably—to hike the Power

Purchase Cost Adjustment Charges (PPAC) last week. While it is not certain whether chief minister Arvind Kejriwal approves of this, in an interview to Reuters, Kejriwal had said, though not specifically in the context of the power sector, that having a regulator didn’t always help in a public monopoly since the regulator could also turn corrupt.

While the confusion and the blame game over who is at fault continue—including a side one on whether the DERC is the handmaiden of the electricity distribution firms—a few points need to be kept in mind.

* Since the current problem can get resolved if NTPC decides not to stop power supplies to BYPL and BRPL, it is evident that suspending the licenses of these two firms will not do the trick. After all, just because the government takes over the two companies doesn’t mean NTPC is going to not cut off supplies on February 10.

* And nor is the problem restricted to NTPC, since the two firms owe suppliers R5,200 crore, it is likely some other company will stop supplies at some point.

* In which case, the Delhi government obviously believes the firms have the cash, but are deliberately not paying NTPC so as to provoke a crisis. Once an Administrator is appointed, the logic goes, she/he will pay NTPC and others and life will go on as usual, perhaps even the 50% cut in power tariffs the AAP had promised will materialise.

* Though not explicitly offered as ‘proof’ of the fact that BRPL and BYPL are misbehaving, that NDPL is facing no payment difficulty does suggest there is more than meets the eye.

Take the Tata Group’s NDPL first. The fact that, with Tata Power's Mundra ultra mega power plant

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