Reliance Infra may face power cut from Tata Power today
03 May 2010
Tata Power Co has indicated that it will refuse a request by the Maharashtra government to continue supplying power to rival Reliance Infrastructure, the distribution utility that supplies power in Mumbai suburbs.
After a cabinet meeting today, the state government is believed to have asked Tata to keep the supply of 500 MW on until it issues a final order on the dispute between the two companies, based on the report of a high-level committee set up to go into the matter.
''The recommendation of the committee has been submitted to the government of Maharashtra and the order from the government is awaited. In the meanwhile, the government has requested Tata Power to maintain status quo. Tata Power has agreed to this request to maintain status quo till 3 May,'' said a statement from Tata Power.
The company says it is not obligated to continue supplying power to Reliance, as a Supreme Court order on this dispute says the former is free to sell its output to any party it wishes to. Nine months back, Tata had told Reliance it would stop supplying the 500 MW electricity by the end of March. Tata made alternative arrangements to sell this power after that date, including an agreement to supply 100 MW of power to state-owned Brihanmumbai Electric Supply and Transport Undertaking (BEST).
Tata says the government has asked it to supply the 100 MW to BEST but keep everything else unchanged.
Reliance Infrastructure (R-Infra) says Tata's decision would lead to blackouts in the suburban region of Mumbai. The company also says the court judgment is being interpreted incorrectly by Tata. The state government constituted a committee to probe the dispute.
