The Uttar Pradesh Power Corporation (UPPCl) has cancelled Anil Dhirubhai Ambani’s Reliance Power’s Chitrangi power project in Singrauli and seized its bank guarantee of Rs 74 crore for allegedly not fulfilling its commitment of setting up the project as per schedule.
UPPCl chairman Alok Kumar said that Reliance Power was supposed to sign the contract, but it kept on asking for extensions and hence the project could not be developed on time.
The UPPCl had issued a letter of Intent (loI) to Reliance Power for the supply of 2,456 MW of power from the 3,960 mw Chitrangi power project near Sasan (Madhya Pradesh) after it emerged as the lowest bidder in a competitive bid for purchase of power by UP government in 2011. As per the loI, Reliance Power was to supply power to UPPCl at a leverised tariff of Rs 3.70 for a period of 25 years.
“The UPPCl has been continuously striving to procure power at cheaper rates and Reliance Power should have started work on developing the project on time. This was an important project and had it been completed, it would have provided 2,456 MW power at Rs 3.70/unit for 25 years. But Reliance Power has not signed the contract and as a result, the state as well as UPPCl has been forced to bear heavy losses,” said Kumar.
``We could not buy cheap power from elsewhere as we kept waiting for them to sign the contract and were thus forced to buy expensive power to meet our demand. As a consequence, the UPPCl has seized the group’s bid bond,” Kumar said.
It may be mentioned that the coal for the project was to be sourced from captive coal mines allocated to Sasan Ultra mega power project (UMPP), which the Centre had cancelled in view of Supreme Court’s judgments of August 24, 2014, and September 25, 2014, by which 214 coal blocks allocations were cancelled.