Power purchase norms violated

The Karnataka Power Transmission Corporation Limited (KPTCL) has demanded Rs 1408.66 crore for power procurement for the year 2010, although it has been barred from such procurement.

In its application for power revision, the KPTCL has submitted that Rs 1273.81 crore worth power has been procured for the year 2007 and Rs 1304.54 crore and Rs 1376.96 crore are the payable amounts pending for the years 2008 and 2009 respectively.

Besides, an estimated Rs 1408.66 crore has been shown as amount to procure power for the year 2010 from a company called Sundry Creditors for power purchase. Likewise, the KPTCL has shown Rs 114.23 crore for 2007, Rs 176.83 crore for 2008, and Rs 221.94 crore for 2009 for the sale of power to various companies. An estimated Rs 247.21 crore for 2010 is shown as amount due from the sale of power.

The KPTCL, being a State transmission licensee, is barred from trading power, under Section 39(1) of the Electricity Act. Earlier, the Union Government in an order dated June 9, 2004 had extended the said authorization of the applicant to trade in power only by an year.  As per the order, the KPTCL can not trade in power.

Interestingly, the KPTCL has shown Rs 1347.46 crore for the year 2007 as receivable, Rs 1278.51 crore for the year 2008 and Rs 958.49 crore for the year 2009 and an estimated Rs 1054.34 crore for the year 2010 as receivable amounts.

Surprisingly the entire business income (transmission charges) of KPTCL amounts to Rs 775.87 crore for the year 2007, Rs 766 crore for the year 2008, Rs 799.02 crore for for the year 2009 and an estimated sum of Rs 840.87 crore for the year 2010.

Following the open access regime, only the electricity supply companies are authorised to procure power and distribute it through the transmission lines of KPTCL.

FKCCI’s objections

The Federation of Karnataka Chamber of Commerce, in its objections to the KPTCL statistics, has sought an inquiry into the huge amount of receivables. It has also sought to know how the KPTCL can go for power purchase violating the norms.