Bhoothathankettu power project: KSEB’s incompetence causes loss of Rs 500 crore  

Thiruvananthapuram: The Kerala State Electricity Board Ltd (KSEB) has suffered a loss of around Rs 500 crore in the Bhoothathankettu small hydroelectric project in Ernakulam. The Board failed to terminate its agreement with the company, which, violated the terms of the contract, and the consequent deficit in revenue from power generation. The Board has now decided to initiate an inquiry into the involvement of its officers in this issue.

Breakup of loss
KSEB spent Rs 169 crore on civil and electro-mechanical works, of which Rs 70.44 crore was spent on incomplete electro-mechanical jobs. The project was scheduled to start power generation on August 3, 2016, and earn Rs 35 crore a year. Over the past eight years, the total loss amounted to Rs 280 crore. In addition, KSEB also lost interest on the money paid, incurred expenses on purchasing electricity from outside the state and paid interest on this money, taking the total to Rs 500 crore.

Shoddy implementation
KSEB gave a contract to Sri Saravana Engineering Bhavani (SSEB), a Tamil Nadu-based company, in March 2015 to build a 24 mega-watt project at Bhoothathankettu within 18 months. While SSEB carried out the civil works, the company imported two loads of equipment from a Chinese firm named Hunan Shaoyang Generating Equipments Company.

However, a third load comprising crucial equipment such as a rotor, stator and runner was not sent to the site. Despite this lapse, KSEB paid Rs 70.44 crore of the total contract amount of Rs 81.80 crore to the Tamil Nadu company, violating the terms.

During the next eight years, KSEB demanded the SSEB to complete the project, but the firm came up with various excuses. Subsequently, the KSEB directly contacted the Chinese company, which said that the third load meant for Bhoothathankettu was sold to another firm.

Meanwhile, SSEB launched measures to import the equipment from another Chinese company at a higher cost. The KSEB has now warned the Tamil Nadu company that it would be blacklisted if the necessary procedures to import the equipment are not initiated within 15 days and the machinery doesn’t arrive at the site in 90 days. Moreover, SSEB would have to bear all liabilities and face legal action in case of further lapses. According to the Electricity board, a re-tender will be conducted if the Tamil Nadu firm doesn’t meet the latest deadline.