ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Power Tariff Scam Gets Bigger at Rs 50,000 crore

The dimension of the scam relating to inflation of power tariffs by, among other things, over-invoicing imported coal has become considerably bigger. It has now come to light that electricity generating companies are seeking to obtain compensatory tariffs from regulators. In addition, particular firms in the Adani and Essar Groups, have allegedly over-invoiced imports of equipment. The total size of the scam is currently estimated at Rs 50,000 crore, if not more.

Questionable Economics of LNG-based Power Generation

In recent years, liquefied natural gas (LNG) has become the preferred option for power generation. This paper unravels the process of this shift away from coal-based power generation and makes an economic comparison of LNG-based generation with its competing options. As a sensitivity analysis based on cost variations of components revealed, in most cases, coal-based generation turned out to be a cheaper option. Though experts have spoken up for LNG's environmental friendly nature, questions still remain even as India's extensive coal reserves remain poorly exploited.
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