KSEB financial crisis: VD Satheesan slams govt for withdrawing power contract

V D Satheesan and Pinarayi Vijayan. Photo: Manorama

Thiruvananthapuram: Opposition leader VD Satheesan on Tuesday alleged that the state government's decision to terminate a contract to purchase electricity from outside sources forced the Kerala State Electricity Board (KSEB) into an unprecedented financial crisis. 

The contract said by Satheesan was signed by the previous UDF government to source power for 25 years at a nominal rate of Rs 4.29 per unit. 

The Pinarayi Vijayan-led LDF government continued to purchase power under this agreement. But the agreement was terminated nearly seven to eight months ago on alleged grounds of corruption, said Satheesan. "As a result, KSEB started purchasing power at a huge rate of Rs 8-9 per unit, incurring a loss of Rs crore per day," he accused. 

While speaking during the question hour, the LoP pointed out that the Electricity Board has been going through the gravest financial crisis in its history and there are several reasons for the situation.

According to Satheesan, KSEB was profitable under the UDF governments, but it had plunged into an unprecedented financial crisis through various projects, including the Transgrid project and the rooftop solar scheme after the first Pinarayi Vijayan government came to power. 

The Board has now incurred a financial burden to the tune of Rs 40,000 crore in the last seven to eight years, the Congress leader charged. However, Chief Minister Pinarayi Vijayan rejected the charges and said that the cancellation of the 25-year-long contract was not a voluntary decision of his government, but was as per the direction of the Electricity Regulatory Commission.

He said considering the power demands of the state, his government had continued the long-term contract signed by the Congress-headed UDF government but the Regulatory Commission directed to cancel it saying that its permission was not sought for the same. "After the cancellation of the contract, issues like what the LoP mentioned here, have cropped up. Because power was available only at a higher price rate," the CM admitted.

Vijayan also said his government has now used its special privileges to intervene in the matter and resolve the issues. Only some technical issues are left and steps have been taken to address the cancellation of the contract, he further said, adding that even the Regulatory Commission also accepted the government's stand in this regard.

Power Minister K Krishnankutty also said that it was not the state government but the Regulatory Commission which had directed them to cancel the contract, saying that rules were not followed in its signing.
(With PTI inputs)

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