2 yrs have elapsed since state had demanded free power in Sep 2010 but Centre is yet to respond Odisha is sore over the Centre's apathy towards its demand for allocation of free power from coal-fired power plants and power generated from coal washery based rejects. Two years have elapsed since the state had demanded free power in September 2010 but the Centre is yet to respond. Chief Minister Naveen Patnaik had sought the intervention of Prime Minister Manmohan Singh and Union minister for power for allocation of free power. "The Centre claims it honours all reasonable demands and recommendations made by state governments. But it has turned a deaf ear to the justifiable demand for free power made by five states - Odisha, Madhya Pradesh, Chhattisgarh, Jharkhand and West Bengal. Even the Planning Commission of India at its recent meeting has upheld the states' demand for free power allocation as 'genuine' and has engaged The Energy & Resources Institute (TERI) to study the modalities”, a top official source told Business Standard. Concerned over the nominal advantage accrued to the host state due to the implementation of coal-based power projects, the Odisha government had urged the Centre to allocate 25% free power from independent power producers (IPPs) and 33% free power from power plants based on coal washery rejects. Later, the state government scaled down its demand for free power from power plants based on coal washery rejects to 13% as the original demand was deemed unreasonable. The Odisha government had pointed out that while states consuming the power and coal from the host state get benefited, the host state gets a nominal advantage of limited employment opportunity and also a very low royalty on coal. Both coal mining and power generation being in the manufacturing sector, hardly any ancillary industry gets developed around these activities. The above situation leads to an inequitable sharing of cost and benefits from coal mining and power generation. The host state also suffers from severe adverse impacts which includes huge quantum of land acquisition and consequential displacement and rehabilitation of the locals, mostly tribals. In addition to this, these projects lead to progressive depletion in forest cover posing a threat to preservation of flora and fauna, great risk of environment pollution, strain on water resources, over utilization of the state's existing infrastructure and other resources like roads and railways, unfilled mine voids and un-reclaimed land. Odisha had inked MoUs (memorandum of understanding) with 29 IPPs with a total envisaged generation capacity of 37,000 MW. In addition to this, Mahaguj Collieries Ltd, a joint venture between the state owned power generation companies of Maharashtra and Gujarat, had proposed to set up a 2500 MW (10x250) power plant near Angul based on coal washery rejects.