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Monday, August 27, 2007

no thermal plant in my backyard, please!

text of the letter sent to the press:

From Nandikur to Tadadi to Chamalapur, nobody wants a thermal power plant in his backyard, particularly when a major part of the power generated is going to be feeding consumers not in the immediate neighborhood, but in distant Bangalore.

Now, there doesn't appear to be much of an appreciation, amongst the powers that be, that in order to meet the state's demand for power, it doesn't require coal to be transported from afar and burnt here. There is a far more efficient and cost-effective option as has already been amply demonstrated by the NTPC (National Thermal Power Corporation Ltd) - PGCIL (Power Grid Corporation of India Ltd) - KPTCL (Karnataka Power Transmission Corporation Ltd) arrangement, whereby Karnataka is able to tap at Whitefield (in Bangalore) 750MW of power generated at Talcher in Orissa. And, NTPC/ PGCIL will be happy to augment that capacity and supply as much power as is needed by Karnataka, provided KPTCL gets itself into a position to pay for the power on time. To know where that situation stands as of now, all you need to do is to visit the KERC (Karnataka Energy Regulatory Commission) site which will tell you that for purchases of the order of Rs 24,830 million, KPTCL owes KPCL (Karnataka Power Corporation Ltd) Rs 21,046 million any given day, ie a debtors-days figure of an incredulous 309. If I understand the Company Law guidelines correctly, this entire amount will have to be shown under 'doubtful debtors' in the KPCL balance sheet. Given such a scenario, it is surprising that NTPC/ PGCIL even maintains a relationship with KPTCL, fearing as it should be of similar treatment should a maverick politician came on to the scene and issued orders that way.

And, that exactly is the problem. With the interference in the running of the ESCOMS by the politicians, they are not able to collect their monies on time to pay up KPTCL, which in turn is not able to pay KPCL on time, and the vicious cycle perpetuates.

And, the truth of the matter is that this problem can be solved only through privatization of distribution, perhaps on the lines of the model adopted by New Delhi, in the cities. And, as for the rural areas, there is the excellent Hukeri Co-op Society model, which at worst may require a bit of tweaking.


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