Delayed power projects run up Rs. 29,234 cr in cost escalation

Delayed power projects run up Rs. 29,234 cr in cost escalation
PRESS TRUST OF INDIA

August 20: Delays in the completion of about 54 ongoing public sector thermal and hydro power projects have resulted in a massive Rs 29,234 crore in cost escalation and also held up commissioning of nearly 17,450 MW of electricity in the country, a leading chamber has said.

In a study carried out by the Associated Chambers of Commerce and Industry (Assocham) on time and cost over-runs in central sector power projects, it said the completion costs has climbed up by over 87 per cent from Rs 33,366 crore to Rs 62,600 crore with some projects running behind schedule by as long as 20 years.

The chamber asked for the setting up of ministerial committee for fixing responsibility for the time and cost over-runs of projects being implemented by the PSUs. The task forces created to monitor thermal, hydro and transmission and projects should submit their findings on remedial packages on a regular basis to the proposed committee, it said.

The chamber said slippages have "unfortunately" occurred when most parts of the country, barring the eastern region, were facing severe power shortages adversely affecting the prospects of sustained industrial growth.

Most of the fast track power projects have gone off the track and got entangled in procedural and legal problems, Assocham said and asked the government to greatly focus on this sector so that the country can achieve a quantum jump in power generation.

There are more than ten projects which are lagging behind over 10 years including Balimda Dam Toe project in Orissa scheduled for commissioning in 1982-83, Karbi Langpi Assam in 1985-86, Jakham, Rajasthan in 1988-89 and North Koel Bihar in 1988-89.

Around 15 projects are behind schedule for the last ten years including Ranjit Sagar project in Punjab, Ghatgar in Maharashtra, Sharavati in Karnataka, Pykara Ultimate in Tamil Nadu and Sardar Sarovar in Gujarat.

Assocham asked the government to prohibit reopening of power purchase agreements unless mala fide intention was clearly established.

Ministries of power, petroleum and natural gas, coal, surface transport, railways and finance will have to work in close coordination to ensure that delays do not occur in project clearance and other fuel supply-related issues, it said.