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Cancelling DPC-I, reviving DPC-II a mistake: Govt

The Maharashtra government on Friday admitted that 'its biggest mistake was the decision to cancel the first phase of the US energy major Enron's $3-billion power project and reviving it with an additional capacity of 1,444 mw in phase-II within a record time of 13 days'.

"There was a lot of pressure from the then ruling party (Shiv Sena-BJP combine) which ignored several crucial things and approved the project with more capacity after canceling its phase-I," state principal secretary for energy Vinay Mohan Lal said at a seminar 'Power Sector Scenario in Maharashtra', organised by the Indian Merchants' Chamber in Bombay.

Despite the World Bank's opposition in 1995 to the size and nature of the base load project, the then state government decided to go ahead with it, he added.

"Maharashtra projected a shortage of base load power after consumption of the entire 2,184 mw sourced from DPC...such an optimistic scenario should not have been painted by us," Lal said.

He said the World Bank had termed the project as 'too expensive' and disapproved the project in terms of size, fuel and capacity.

"The PPA's terms over payment vis-a-vis the 90 per cent plant load factor are also seen as unreasonable," Lal said.

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