The Telegraph
Since 1st March, 1999
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When in dark, invoke Enron

Mumbai, May 3: Four years after it shut down, the ghost of Enron continues to haunt Maharashtra. A day after a Shiv Sena protest against long hours of loadshedding turned violent, chief minister Vilasrao Deshmukh today admitted that the power crisis stemmed from the shutdown of Enron's 2,184 mw Dabhol Power Project in May 2001.

'We failed to generate any additional power in the last decade. We were involved too much with the Enron controversy,' Deshmukh told reporters after a meeting in Pune, where Shiv Sainiks had run amok at a Maharashtra State Electricity Board (MSEB) office, smashing glass panes and damaging furniture. Protests had also been reported from Nagpur, Amravati and Kalyan.

The Enron project's Phase I in Ratnagiri, with a production capacity of 750 mw, became operational during the Sena-BJP rule, but the plant shut down following political controversies and an international meltdown in the US.

The Maharashtra government hopes the Dabhol Power Project would be revived and help it reduce the shortfall, which is expected to grow to 10,000 mw by 2009-10. Board chairman Jayant Kawale said, 'We are counting on the expansion of plants in Uran, Khaparkheda, and Talegaon. We hope that power from Dabhol Power Project and the Sardar Sarovar Project will help us bridge the shortfall.'

The BJP's national spokesperson, Prakash Javadekar, differs. He said that even if the Enron project were revived, it would place a burden of almost Rs 5,000 crore on the state. The foreign lenders would demand Rs 900 crore, Rs 500 crore would go to the overseas private investment corporations, a whopping Rs 2,000 crore to export credit agencies and Rs 1,000 crore to General Electric and Bechtel, the two major lenders to the project.

Last month, the state hurriedly signed MoUs with eight private players for generating a total of 12,500 mw against an assurance that these companies would sell 50 per cent of the power generated to Maharashtra. But, uncertainty continues about exactly when the projects would be operational. For now, Kawale said, Maharashtra would buy an additional 350 mw from Andhra Pradesh and Gujarat.

The Centre has promised Maharashtra 1600 mw, out of which 500 mw will be delivered by May-end.

The government announced a load-shedding schedule in the state last month, condemning the villages to nine hours of load-shedding a day and urban areas to four. Mumbai and its suburbs like Thane, however, were spared the power cuts entirely, prompting allegations of bias across the state.

A furious Devendra Fadanvis, BJP legislator from West Nagpur, has threatened to cut off Mumbai's power supply in retaliation. 'There is a clear regional bias here,' he said. 'Some kind of balance has to be achieved.'

Kawale denied that the board had a Mumbai bias. But in a symbolic gesture, supply has been cut off to illuminated billboards and neon hoardings in the city.

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