CHANDIGARH: The power from Talwandi Sabo and Rajpura thermal plant will cost more to the Punjab State Power Corporation Limited (PSPCL) after the Supreme Court allowed the contempt petition of Talwandi Sabo Power Limited against Baldev Singh Sran CMD and others.

Punjab State Power Corporation Limited will have to pay washing cost of coal, the transportation from the mine site via washing of coal to the project site inclusive of cost of road transportation within a period of 8 weeks from August 7,  the date of judgment. The judgment was delivered by the Supreme Court bench of Justice Rohinton Fali Nariman and Justice Surya Kant.

 Last year in August Supreme Court has decided that the private power generating company was entitled to the coal washing and transportation costs. This amount was to be paid within a period of 12 weeks failing which it would carry 12% simple interest.

Now the cash strapped PSPCL will have to pay the arrears of Rs. 2800 crore payable to Larsen and Tubro who are operating 1400 MW Rajpura thermal and 2100 MW Talwandi sabot thermal through subsidiaries by October 2 along with one year interest charges.

This cost to be incurred by PSPCL will be passed on to the consumers who will bear the brunt of follies committed by PSPCL while finalizing the power purchase agreement.

PSPCL had signed the power purchase agreements with the private generators supplying power from Rajpura and Talwandi Sabo thermal plants for a period of 25 years. The annual washing charges will be around Rs. 500 crore for the two thermal plants.

PSPCL is already feeling the pinch of late payment of subsidy from Punjab government. PSPCL has received cash subsidy of Rs. 1622 crore up to July this year. An amount of Rs.214 crore has been adjusted against interest charges of Uday bond. As per PSPCL website an amount of 007 crore has been adjusted against excise duty and IDF due. The less subsidy received amounts to Rs.1980 crore up to July end.