Reliable sources said the Deepak Parekh committee, which was formed to findthe impact on financial capabilities of the Karnataka government due to theproposed escrow cover to Mangalore Power Company and other related issues,is planning to announce its guidelines on January 15.

The escrow account is an exclusive fund that the state electricity boardopens and is guaranteed by the state government assuring payment to powersuppliers. The escrow amount is equivalent to one month's billing by thepower company.

According to norms fixed by the Central Electricity Authority (CEC), thetotal escrow amount for all power projects put together cannot exceed rupeevalue equivalent of 1,500 mw of power. Early last month, MPC had pulled outof the mega project citing delays in getting approvals from thegovernment.

After scrapping the $1.3 billion project, the company had put some ridersincluding the approval from the state government to stand by the earlierpower purchase agreement, escrow cover from Karnataka Power TransmissionCorporation and counter guarantee from the Centre. MPC managing director RonSommers was unavailable for comment.

According to sources, the committee is expected to review the fuel policy,required capacities for the state for the next five years, investments fromthe private and public sectors in power ventures and their strategiclocations, and the borrowings of the state to set up power plants.

Industry sources said the committee would also take into account the ongoingprojects of other companies as well in addition to the 1,000 mw Mangaloreproject. The Deepak Parekh Committee report would have implications on theongoing projects of Karnataka Power Corporation Ltd (KPCL).

A top KPCL official said the company was going slow with its power projectsas the state government had not made up its mind on the new ventures. KPCLwas planning to come up with major expansion plans that include investmentsfor Vijayanagar, Bidadi and Raichur power plants.

With this, KPCL's fund raising programme is being put on the backburner forquite some time. In fact, Industrial Development Bank of India (IDBI) wasplanning to pick up some stake in its Bidadi Power venture. ``Going by thecurrent conditions, revival of KPCL projects may take some more time,'' KPCLofficials said.

KPCL officials said: ``After the departure of the previous managing directorK Jairaj, nothing had happened. We had waited for the new government at thestate and now expecting decisions by the Deepak Parekh Committee to go aheadwith the projects,'' they added.