Clean blow
mumbai-based Reliance Energy Limited (rel) is in the soup following a March 19, 2005, order of Dahanu Taluka Environment Protection Authority (dtepa) of Dahanu, Maharashtra. rel has to furnish a bank guarantee of Rs 300 crore in favour of the Union ministry of environment and forests (moef) within a month to assure that it will establish a flue gas desulphurisation plant (fgd) in its Dahanu Thermal Power Station (dtps) , near Mumbai. But evidence strongly suggests it has been conspiring to avoid setting up the fgd and the order is a big blow to it. dtepa also said rel has disobeyed the Bombay High Court (hc) and the Supreme Court in delaying the fgd in Dahanu, a designated eco-fragile area
rel's problem is compounded by the fact that dtps's permission to operate expires on April 30, 2005. dtepa will review the permission on April 26, 2005 but is unlikely to agree to the company's desire of a five-year extension.
How it got caught rel informed dtepa on February 12, 2005 that it had finalised negotiations with Ducon Technologies Inc. to set up the fgd. It refused to reveal further, saying it had "entered into Confidentiality Agreement with Ducon'. But rel's Letter of Intent (loi) made it clear that the work on the fgd would be delayed (see box: Clinching evidence). To understand rel's motives, on March 4, 2005, Dahanu Taluka Environment Welfare Association (dtewa), a local non-governmental organisation, spoke to two other bidders for the fgd's installation: Monsanto dmcc Environmental Technical Engineering Limited and Alstom Power. On March 14, 2005, dtewa told dtepa that the bidders were unhappy with the bid process. It claimed that rel had told Alstom it wanted to delay the fgd. It also objected to giving Ducon the project , citing lack of experience in fgd technology.
dtepa was already upset about rel not inviting it to the kick off meeting over the fgd; the latter had offered to do so earlier. The dtepa order takes a strong note of this. The authority had also noticed contradictions in the project timetable submitted to it by the rel and the one mentioned in the loi. To settle the matter, it invited Ducon to its March 19 meeting. But Ducon's general manager (operations) South East Asia, Kiran Patil, didn't turn up, citing "important-preoccupation'. An angry dtepa said in its order that rel was purposely delaying the fgd.
rel filed a review petition before the dtepa, asking it to reconsider the order. The dtepa rejected it, saying it isn't empowered to review its own order. The only option left for rel is to approach the hc. It may also reopen the debate over the fgd; the state pollution control board's March 2004 report, prepared at the behest of moef' s Rajagopalan Committee, discounted its need . But the two deadlines will make it all tough.