PWP threatens to pull out of govt over Enron

Senior PWP leader N D Patil, who is also the convenor of the Coordination Committee, had on December 2 demanded the resignation of Energy Minister Padamsinh Patil for virtually dismissing the assurance of a review given by the Chief Minister at a high-level meeting of the committee.

“At the coordination committee meeting, Deshmukh had made it clear that his government will review the Enron project. Now, on the floor of the house, Padamsinh Patil had contradictory statement. Under such circumstances, we want specific assurance from Deshmukh. In any case, N D Patil is meeting the Chief Minister within a couple of days to explain him the stand of the PWP on the Enron project,” the PWP leader added.

Besides PWP, which has seven members, the Janata Dal and Samajwadi Party have also opposed the Enron power project.

At a cabinet meeting on Tuesday, tempers ran high when a section of senior ministers urged the CM to scrap the multicrore project. Marketing Minister Ganpatrao Deshmukh (PWP), ona strident note, demanded immediate scrapping of the project. If such a decision was not taken, he would quit the government, he said at the meeting, which discussed at length the financial situation of the Maharashtra State Electricity Board (MSEB).

By and large, the consensus among cabinet members was that immediate steps should be taken to escape from the "Enron trap." Senior members Chhagan Bhujbal, Ajit Pawar and Ranjeet Deshmukh expressed the view that either tariff strucure ought to be reviewed or the project should be scrapped altogether.

“The cost of Enron’s power will reach Rs 27 per unit if the dollar-rupee exchange rate touches 54. This can go further if the fuel rate increases in future,” a senior cabinet member said. However, scrapping the project would entail paying compensation of upto Rs 20,000 crore to the company, the minister added.

The Minister said, given the circumstances, there are two options before the government: either urge the Centre to include Enron in the national common grid and share the financial burden considering it has issued a counter guarantee for the project, or convert it into a multi-state project and persuade neighbouring states to buy power from it.

Senior BJP leader Gopinath Munde, participating in a debate in the assembly today on the performance of the MSEB, criticised the DF government for the ongoing power crisis. “The shortfall in demand and supply was about 1800 MW which was man-made. The government was using only 40 per cent of the 750 MW power generated by Enron. The cost of the power could come down by Re 1 if the government bought 90 per cent of its product,” he said.

Further, the rate of Enron’s power could come down to Rs 4.02 from Rs 4.94 once the company began use of natural gas in generation, he contended. He said the government could overcome the current crisis if it used additional 350 MW power from Enron, 500 MW power from Tata Electric Company and BSES and allow extensive use of captive power generation which could reach upto 1000 MW.

Accusing the government of lacking will power and efficiency, Munde said the government was not ready to spend more money on purchase of power. The Sena-BJP government had made a provision of Rs 1,300 crore in its budget for 1997-98 for the purpose. On the other hand, the DF allotted only Rs 1 crore to the MSEB for power distribution whereas the demand was for Rs 450 crore, he pointed out.