All India Power Engineers Federation (AIPEF) has appealed to Prime Minister Manmohan Singh to intervene into the rise of gas prices in the country which will lead to hike in the rate of electricity in the country.
''The cabinet committee on Economic affairs has increased the purchasing price of natural gas to $8.2 mmBtu. Increase of purchasing price of natural gas will have adverse affect on Power Cost generated from natural gas,'' claimed AIPEF secretary Shailendra Dubey here on Monday.
In a letter to the PM here Dubey demanded immediate roll back of gas price hike in larger interest of common man.
''Four weeks ago Petroleum Ministry submitted to the standing committee on Finance that cost of production from the KG Basin was a mere $2.74 mm Btu. Despite
such a low cost of prod uction cabinet committee on economic affairs increased the purchasing price of gas to $8.2 mm Btu which is very high,'' the letter alleged while
adding that such a huge hike is creating a situation where Reliance Industries ltd. (RIl) will gain a very huge profit and therefore it is clear that the price hike is aimed at providing a huge benefit to a corporate giant.
Dubey, in the letter, copies of which has been sent to leaders of the opposition in lok Sabha and Rajya Sabha, said the cost of production of RIl in KG - D6 Block in 2011-12 was $2.48 mm Btu excluding levies and $2.74 mm Btu including levies. At present the purchase price of domestically produced natural gas is $4.2 mm Btu which has been doubled to $8.2 mm Btu.
''Apart from the economic down turn, the country is going through an acute power shortage due to non supply of mandated natural gas from KG Basin. As many as 12 power plants are lying idle and 19 power plants are affected by non supply of gas from KG Basin. All these 31 plants across the country were expected to collectively produce 15000 MW power,'' he said in his letter to the PM.
The AIPEF secretary said the supply of KG D - 6 gas to power sector is zero since March,2013. As per Petroleum Ministries estimates KG Basin is falling short by whopping 80 per cent of
it's mandated gas production. However the government has not penalized RIl which is expected to pay 3 billion dollars as penalty on this account.
''It is not fair to double the natural gas price. It is also worthwhile to mention that increase shall be effected from April 2014, the date by which time elections for new lok Sabha will be in process. Therefore neither it is fair nor it is moral to hike the gas price which is already affection power production of about 15000 MW and which is bound to hike the power generation cost, burden of which will be transferred to common man,'' he said.
Dubey said PM should intervene to revisit the exorbitant pricing of natural gas affecting power generation and it's cost in the country.