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Ministry to seek more funds for power scheme

Our Bureau

BANGALORE, Feb. 25

THE Power Ministry will be seeking additional funds to strengthen the Accelerated Power Development Programme (APDP), which, among other things, aims at financing projects on a short-term and long-term basis to improve the power supply position from the existing generating capacities.

Stating this here on Sunday, the Union Minister for Power, Mr Suresh Prabhu, however, did not specify the amount. He said about Rs 1,000 crore was available during the current year for implementing the programme. An additional Rs 1,000 crore could be lev eraged from the Power Finance Corporation and Rural Electricity Corporation for the purpose.

Mr Prabhu, who was here to launch the APDP and for the inauguration of a 220-kV station at Tubinakere in Mandya district, said the Government was seized of the serious problems of the power sector and expects the State Governments to expedite the impleme ntation of the reforms programme, with a particular emphasis on privatisation of the distribution sector.

APDP, which was formulated recently by the Union Government, has been launched in Karnataka with a view to improving the reliability and quality of power supply in three to four distribution circles in the State. It will later be extended to other circle s.

On the progress of power reforms in Karnataka following a Memorandum of Agreement signed between the Union Power Ministry and the State Government, Mr Prabhu said excepting a slow progress in metering, by and large, it was on expected lines.

Similar memoranda, which set out a reforms recipe to reduce the cost and to improve the efficiency and quality of power supply, are likely to be initiated with Rajasthan, Delhi, Chhattisgarh, Uttaranchal and Punjab, the Minister said.

While declining to give any explanation on the ongoing Enron issue, Mr Prabhu said the lesson one can learn is to be careful in providing counter-guarantees to power projects.

He said despite a formal political consensus across parties and Governments on reforms, ``very feeble implementation has caused a serious deterioration in the power situation.''

Later, addressing a press conference, Mr Prabhu said that two expert committees have been set up to come up with an action an plan for systems improvement and to identify broad policy issues on improving efficiency in power distribution.

The committees will be submitting their reports within four months, he said adding that ICICI and experts on multilateral funding agencies would assist the committee on streamlining the policy issue on distribution system.

Systems efficiency with appropriate modernisation was a pre-requisite to make the power sector reforms successful, the Minister said.

Mr Prabhu said the ongoing controversy on Dabhol power project will not affect the foreign direct investment in the power sector. Several companies are still showing interest and 58 projects were in pipeline with many of them approaching financial closur e.

Mr Jairam Ramesh, Deputy Chairman of the Karnataka Planning Board, said Karnataka has been granted Rs 294 crore under the APDP to be completed in one year.