Anger at BSES over delay to new power project

Vol 4, PW 8 (24 May 00) Midstream & Downstream

Democracy has its advantages but in India it often leads to frustrating delay in approval for key infrastructure projects.

One such project is a proposed 495-MW power plant in Maharashtra, promoted by the Bombay Suburban Electricity Supply (BSES) company, originally planned for the district of Palghar, but due to local opposition, shifted to Safale. Officials at BSES are increasingly angry at the inability of the Congress-led state government of Maharashtra to clear the project so that construction can begin.

"We do not know what is holding it up," a senior BSES manager tells Petrowatch, "It is very frustrating. All the clearances should have come in two weeks ago.

A correspondent writes that politics is to blame for the delay. Maharashtra's former Shiv Sena government approved the BSES project shortly after it was voted out of power last October.

But for reasons best known to itself the new Congress administration wants to "review" it and has so far accorded only "in-principle" clearance. Energy secretary Pramod Deo tells Petrowatch the BSES project still requires "Section 44" clearance from the Maharashtra State Electricity Board (MSEB) - another source of delay.

According to "Section 44" of the Electricity Supply Act, the MSEB has to give clearance for all new generating units in the state. After that BSES has to obtain environmental clearance.

To further complicate matters, the Maharashtra cabinet has asked the MSEB to submit a financial compensation package; detailing how much money it will lose because of the additional generating capacity from the BSES plant. As hurdles continue to mount, BSES managers are becoming increasingly despondent.