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G.K. Nair

Kochi , Aug. 28

THE State Government's decision to stall the hearing on the Indian Aluminium Industries Ltd on its petition seeking permission for open access to the transmission system of KSEB might delay the re-opening of the company's smelter unit at Eloor.

As the cost of power supplied by the KSEB was higher, the company, after reaching an understanding with the Power Trading Corporation (PTC), had approached the Kerala State Electricity Regulatory Commission (KSERC) seeking permission for drawing power from the PTC.

The Commission was to have heard the parties on August 28 in accordance with the provision of sub section 2(d) of Section 39 of the Electricity Act 2003.

However, the State Government through a notification dated August 23 had declared that "all provisions contained in the Act, except Section 1, Section 121 and Sub-section (d) of section 172 shall not apply in the State of Kerala for six months from the approved date i.e., 10th June 2003."

Based on this order, the KSERC had cancelled the hearing, raising uncertainty over the possibility of re-opening the unit.

The company management had shut down the smelter unit from August 1 last and asked its 326 employees to stay at home as the concession on power charges extended to the company by the State Government had expired few months back.

It had already surrendered the power supply allocation of the unit to the State electricity board. On a request by the Indal, the PTC had agreed to supply power to the company at Rs 2.50 per unit.

However, in order to draw power a no objection certificate from the KSEB is required, the KSERC had sought the formers response on the issue.

The KSEB had responded positively but with some riders, official sources said. It had put the ball in the Government's court saying that a decision on granting permission to the company had to be taken by the State Government. Then, it said that Indal had not got the feeder capacity to draw power from the PTC.

In addition, the KSEB had given a list of additional charges raising the power cost to Rs 3.60 per unit, 20 paise more than that of the current rate of Rs 3.40 per unit.

"We were pinning our hopes on the Regulatory Commission and the Governments decision has now shattered all our hopes," Mr K.N. Gopinath, General Secretary, Aluminium Factory Workers' Union (CITU) told Business Line on Thursday. He said that the trade unions would now intensify its agitation.

According to management sources the company used to consume 20 million units of power per month. Prior to August 2001 the company was paying Rs 4.5 crore towards power charges per month and it had increased to 6.75 crore now following the two hikes introduced by KSEB. At this rate the unit cannot be run profitably, they said.

As the authorities had not responded positively the management of the Aditya Birla group company would take appropriate action, they said.

According to the Central Power Bill the consumer could purchase power from any of the grids. Therefore, a timely positive decision was expected from the KSEB, they said.

Closing down of unit, which has been functioning in the State since 1943, would render hundreds of workers jobless. Besides the State would stand to lose around Rs 168 crore towards power charges and taxes. Power constitutes 61 per cent of the cost of production, he said.

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