‘Tangedco failed to levy ₹827.64 cr. damages’

Disposal of ash caused contamination of Kosasthalaiyar, Buckingham Canal: report

The Tangedco did not levy liquidated damages of ₹827.64 crore on nine long-term suppliers who delayed the commencement of supplies from scheduled delivery dates during the previous AIADMK regime. It also paid enhanced tariff to eight long-term power suppliers, despite them not supplying power for the first two years of the agreement period, leading to an avoidable expenditure of ₹712.03 crore till 2018, the CAG report for the year ending March 2018 said.

The CAG report, tabled in the Assembly on Thursday, also found that Tangedco did not follow the guidelines laid down by the Centre for phasing out the accumulation of ash on land, and accumulated 62.15 million metric tonnes in ash dykes in three thermal power stations, as on March 2019.

“The continued dumping of ash on land resulted in the contamination of groundwater, the Buckingham Canal and the Kosasthalaiyar river,” the report said.

On medium-term power purchase agreements, Tangedco did not claim liquidated damages of ₹24 crore from two suppliers for a delay in commencement of supply.

“Instead, it procured the shortfall quantity at higher rates, resulting in the avoidable expenditure of ₹116.04 crore,” it said.

The CAG also found that a delay in the completion of projects by central generating stations (CGS) had led to Tangedco bearing cost escalation of ₹2,381.54 crore, by way of additional cost in tariff, besides purchasing the shortfall quantity by incurring avoidable expenditure of ₹2,099.48 crore.

As Tangedco was not drawing the entitled share of power from low-cost CGS and drawing the same quantity from other costlier sources, it incurred an avoidable expenditure of ₹349.67 crore. It also became liable for payment of higher tariff for purchasing solar power, due to extension of the commissioning period by TNERC, resulting in excess expenditure of ₹605.48 crore, the report said.

The purchase of power from co-generation plants, by terminating the existing agreements and purchasing the same through the short-term route, also resulted in avoidable expenditure of ₹93.41 crore.

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