The protracted dispute over power dues between Telangana and Andhra Pradesh has come to the fore yet again.
BRS president and former Chief Minister K. Chandrasekhar Rao raised the issue in his letter to the Judicial Commission headed by Justice L. Narasimha Reddy, which was formed to investigate alleged irregularities in Telangana’s power purchase agreement with neighbouring Chhattisgarh. He recalled the power woes faced by Telangana during its formative years justifying his government’s decision to enter into a power purchase agreement with Chhattisgarh to meet the requirements.
Mr. Rao stated that according to the Andhra Pradesh Reorganisation Act, 2014, Telangana was entitled to 53.89% and Andhra Pradesh to 46.11% of the power generated in the erstwhile united Andhra Pradesh, based on power consumption statistics from five years before bifurcation. The ratio was to be followed for 10 years, but the share allocated to Telangana was insufficient. While there was a shortfall of 2,700 MW, the situation worsened with Andhra Pradesh not supplying over 1,500 MW violating the provisions of the Reorganisation Act. There was a non-availability of 900 MW of power from gas-based stations. On the whole, there was a shortage of 5,000 MW power leading to a severe crisis in Telangana.
The crisis worsened when Andhra Pradesh took over the Sileru power unit and failed to supply the agreed power. Besides, Mr. Rao alleged that Andhra Pradesh canceled power purchase agreements with private power generation companies to deny Telangana its share.
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His letter comes against the backdrop of a continuing dispute between the two States over the dues payable by the other since the bifurcation of united Andhra Pradesh in June 2014. The Telangana government has been claiming that its power utilities should get around ₹17,828 crore from Andhra Pradesh utilities, while the neighbouring State asserts that Telangana owes ₹3,441.78 crore in principal and another ₹3,315 crore in late payment surcharges for power supplied post-bifurcation. The issue was represented to the Union Home Ministry as well as in the Southern Zonal Council meetings by the two Telugu States even as the Telangana government presented papers in support of its contentions. It said that the total receivables from Andhra Pradesh power utilities was ₹17,420 crore while dues payable to Andhra Pradesh Power Generation Corporation were to the tune of ₹4,887 crore leaving a balance of ₹12,532 crore receivable by Telangana.
The issue escalated when the Andhra Pradesh government lobbied the Union government, leading to the Union Power Ministry’s intervention. The Ministry directed the Telangana government to pay ₹6,756 crore to Andhra Pradesh for the supply of power post-bifurcation and ordered that the payment should be made within 30 days from the issuance of the order.
The Union Power Ministry was in consultation with the Finance Ministry to give a direction to RBI so that the accounts of the Telangana government could be deducted from the amount that should be paid to the neighbouring State. The Union Minister drew flak from Telangana which claimed that the Union government had not ensured implementation of the assurances given in the Reorganisation Act, but had decided to intervene in power dues issue against the interests of Telangana. The Telangana government on its part, challenged the Union Ministry’s decision in the High Court which in turn quashed its orders.
“In our opinion, it is eminently desirable that the dispute between them is resolved amicably, preferably through mediation,” Chief Justice Alok Aradhe and Justice N.V. Shravan Kumar said. Nearly a year after the judgment, the two States have yet to reach a consensus on power dues. Telangana Chief Minister A. Revanth Reddy who took over the reins in December has reaffirmed his commitment to resolving the long standing disputes. With Mr. Revanth Reddy, one time associate of TDP president N. Chandrababu Naidu, inclined to resolve the disputes and a regime change in Andhra Pradesh where Mr. Naidu led TDP coalition taking over the reins after their victory in the polls, hopes are rekindled again over the scope for the two States to settle the issues in a mutually agreeable manner in the coming days.
