BEST, Tata Power slug it out as powerless Mumbai looks on

Sep 04, 2014, 08:03 IST | Shashank Rao

Just a day after one of the worst power outages in recent memory, both companies pulled no punches in blaming each other for city's electricity woes; a cold war has been brewing between them since Tata Power made a move on BEST’s monopoly in the island city

A day after Mumbai saw one of its worst power outages in recent memory, Tata Power, whose power generating unit tripped and led to the crisis, and BEST, which supplies electricity to the island city, traded a volley of allegations.

The companies have been engaged in a cold war of sorts ever since Tata Power made a move to supply to the island city, which had been a BEST monopoly, and got the Maharashtra Electricity Regulatory Commission’s permission to do so on August 14.

While Tata Power, which has been supplying electricity to the BEST, which then provides it to its customers in the island city, said yesterday that doing so would be a tough task in the future and that “Mumbai should generate its own power”, BEST alleged that Tata Power was indulging in “tricks” like Tuesday’s power outage to poach its customers.

mid-day takes a look at the issues at the heart of the companies’ discord:

Power generation
Tata Power: With demand for electricity expected to touch 6,200 MW by 2020, nearly double the current 3,300 MW peak demand, Tata Power wants the island city to have its own power generation sources. “Mumbai must have its own power generation,” said Anil Sardana, CEO and MD of Tata Power.

The company has been supplying electricity to the BEST for a long time, which, in turn distributes to its 10 lakh power consumers, but it indicated yesterday that the BEST or some other company should generate power for Mumbai. This indication from Tata Power seems aimed at wriggling out of the supplying agreement with the BEST so that it can distribute electricity to its own network of consumers once it makes a foray into the island city.

BEST: The undertaking, which had showed interest in setting up a power plant and transmission lines a few years ago, has refused to do so now. “There is no point in the BEST scouting for land, setting up a power plant and generating electricity. There are several players transmitting power,” said O P Gupta, General Manager, BEST.

The undertaking is looking at making smaller purchases of electricity from different sources to address the anticipated future shortfall. BEST officials added that yesterday’s power outage could be a result of Tata Power’s lackadaisical approach as well as a “trick” to poach BEST’s consumers in the island city.

Electricity from Unit 6
Tata Power: The company claims to have restarted the oil-based 500-MW unit after taking permission from the procurers BEST and Reliance Infrastructure. The officials said that with Unit 8, which had caught fire in January, and Unit 5, which tripped yesterday, temporarily out of commission, there was a need to restart Unit 6 to cater to the power deficit. The unit is generating electricity at a cost of Rs 13 per unit and also pollutes more than coal-based units. The company is planning to convert it into a coal-based unit at a cost of Rs 800 crore.

BEST: The undertaking has categorically stated that no permission was given to Tata Power to restart the unit after it was shut down. BEST officials said that Tata Power could have easily met their demand without restarting Unit 6 and that they are not ready to pay such high prices for electricity, which will burden their consumers.

They claimed Tata Power has to supply around 250 MW to the island city and another 250 MW for its own consumers, which it could have done without restarting Unit 6. Claiming that the fire-hit 250-MW Unit 8 could have been restarted had its deadline not been pushed from around June this year to January next year, BEST officials said the undertaking will not pay the higher tariff for electricity from Unit 6 and will approach the MERC.

Transmission woes
Tata Power: With the transmission network not being able to take the load, preventing MSEDCL from meeting the 500-MW shortfall on Tuesday, the company blamed the state government for not improving the transmission lines outside Tata Power’s purview.

Officials said the Salsette-Chembur line, which was overloaded, also falls under the MSEDCL and Tata Power could not be held responsible alone. They also said that expanding the transmission network isn’t easy in a city like Mumbai.

BEST: The undertaking, however, blamed Tata Power for not maintaining the transmission network. They claimed that as a generation and transmission agency, it was Tata Power’s responsibility to augment the network. The undertaking claimed that the feeders were under complete control of Tata Power and the government would look into the issue.

Islanding system
Tata Power: Tata Power claimed that despite the islanding system being in place wherein Mumbai is supposed to continue to get 24-hour supply by sourcing electricity from Maharashtra through the MSEDCL in case of outages like Tuesday’s at least 30% of the city faced power cuts. The company said this figure could go up to 65% by 2020 unless the transmission network is upgraded and more players (like BEST) begin generating power.

BEST: Officials said the undertaking pays Rs 110 crore annually as standby charges to ensure uninterrupted power supply in case of such unforeseen events. It also pays around Rs 300 crore as transmission charges. Under these circumstances, they said, the onus was on Tata Power to maintain its network properly so that MSEDCL can supply electricity to Mumbai in case of outages.

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