Kerala Opposition Leader V.D. Satheesan seeks probe into decision to revoke and then reinstate long-term power supply contracts

Kerala’s Leader of the Opposition V.D. Satheesan
| Photo Credit: THULASI KAKKAT

In deciding to reinstate a clutch of long-term power supply contracts totalling 464 MW after five months, the Left Democratic Front (LDF) government is trying to trick the people of Kerala, Leader of Opposition V.D. Satheesan said on October 7.

Mr. Satheesan demanded a comprehensive probe into the Kerala government’s role in the earlier decision to scrap the 25-year-long Design, Build, Finance, Own and Operate (DBFOO) agreements.

In a statement, he also declared that the Opposition United Democratic Front’s (UDF) will oppose any move to pass on any additional financial burden caused by the denial of approval to the contracts to the consumers in the form of surcharge on electricity bills.

Mr. Satheesan alleged a conspiracy by the Left Democratic Front (LDF) government and the Kerala State Electricity Regulatory Commission (KSERC) as well as corruption in the decision to revoke the long-term power supply contracts entered into by the Kerala State Electricity Board (KSEB). By squeezing in “party nominees,” the government has converted the commission into a “government-sponsored” entity, he alleged.

In May 2023, the commission had denied approval to four agreements the KSEB had inked with Jhabua Power Ltd (115 MW), Jindal Power Ltd (15O MW), Jindal India Thermal Power Ltd (100 MW) and Jhabua Power Ltd (100 MW) under the DBFOO mode.

The KSEB had entered into these agreements in 2014 when the UDF was in power.

However, with Kerala pushed into a power crisis on account of a weak 2023 southwest monsoon, the Cabinet, which met on October 4, decided to recommend the commission to re-examine its decision. For this, the government intends to use its powers under Section 108 of the Electricity Act.

It was these contracts, signed during the UDF rule, that has helped Kerala remain free of power restrictions during the past seven years, Mr. Satheesan said.

In purchasing costlier power during the past five months to make up for the loss of the contracted supply, the KSEB has incurred an additional burden of at least ₹750 crore, Mr. Satheesan alleged.

The DBFOO contracts had guaranteed Kerala power supply at a price as low as ₹4.29 per unit, he pointed out.