Electricity cos have incurred avoidable addnl cost of 2,517.92 cr to buy power from pvt sector"

The Comptroller and Auditor General of India have said that electricity companies in Karnataka have incurred an "avoidable" additional cost of Rs 2,517.92 crore to purchase power from the private sector due to the delay in completing the Yeramarus Thermal Power Station (YTPS).

"A total of 23,188.86 million units of power, in the form of short and medium-term power, valued Rs 11,079.22 crore, was purchased during this period. Out of this, additional cost on the purchase of 22,283.03 million units from private producers, amounting to Rs 2,517.92 crore, could have been avoided in the last four years (2014-15 and 2017-18), had the company completed the implementation of the project within the stipulated time," CAG said in its report.

It said the delay in completing the project increased the project cost from the estimated Rs 8,806.23 crore in April 2009 to Rs 12,915.90 crore as of March 2018. The CAG report on the Public Sector Undertaking for the year ended March 2018 was tabled in the assembly by Chief Minister B S Yediyurappa on Tuesday.

The 1,600-MW capacity YTPS project was taken up in 2007 to bridge the demand-supply gap in the state and was to be fast tracked, considering the ready availability of land, water, coal transport, and power evacuation, thereby gaining invaluable savings in time and money.

The units of the project scheduled to be completed by April 2014 and October 2014 were declared ready for commercial operation only in March and April 2017 respectively, after a three-year delay, the performance audit on the execution of YTPS of Raichur Power Corporation Limited said in its conclusion.

The implementation of the YTPS was through a Joint Venture with Karnataka Power Corporation Ltd and Bharat Heavy Electricals Limited (BHEL). The report cites changes in the designs and delays in the finalization of the major items of work, apart from deficiencies in tendering and award of these works, as the main reasons for the delay.

There were also deficiencies in adhering to the design norms for the plant, it said. Though the project had been declared ready for commercial operation in March/April 2017, it did not run continuously at full load as other ancillary inputs like coal handling plant, general mechanical works, and railway siding and marshaling yard works were yet to be completed (September 2018), it said. This major failure was due to the non-sychronisation of the boiler and turbine generator package with other ancillary inputs, the CAG said.