The Comptroller and Auditor General (CAG) has cut its estimates on windfall gains to Reliance Power from coal captive coal diversion from R42,000 crore in an earlier draft to R11,852 crore in the final report tabled in Parliament on Friday.
The audit is in relation to the permission given to it in 2008 to divert surplus coal from its Sasan block to another of its power project, Chitrangi in Madhya Pradesh.
Reliance Power on Friday said that it had no role in the allocation of Sasan captive coal blocks. ?Coal blocks were allotted to Sasan UMPP (ultra-mega power project) before the bid, and Reliance Power had no role in the allotment,? JP Chalasani, CEO, said.
The CAG has made these observations in its performance audit report on UMPPs. The government has envisaged implementation of a total of 16 UMPPs but so far has auctioned only four. Of these, three ? Sasan , Tilaiya and Krishnapatnam ? have gone to Reliance Power and one, Mundra, to Tata Power.
In the earlier draft, the CAG had estimated windfall gain to Reliance Power from diversion of surplus coal from both Sasan and Tilaiya UMPPs at R1.2 lakh crore, creating a political storm. The CAG has now withdrawn its observations on the Tilaiya UMPP. The government referred the matter to the attorney general for legal opinion. The AG justified the decision to allow the developer to divert extra coal from the project in an opinion in April this year.
An empowered group of ministers on UMPPs, led by then finance minister Pranab Mukherjee, used its discretionary powers in 2008 to allow RPower to divert surplus coal from the Sasan mines. Reliance has quoted a R2.45 a unit tariff for the Chitrangi project, against R1.19 a unit tariff offered by it for supply of electricity from the Sasan UMPP.
