States derail Railways move to procure cheap power

NEW DELHI. The delay on State governments’ part in giving no-objection certificates (NOCs) to Independent Power Producers (IIPs) for wheeling the electricity is preventing the Railways from procuring cheaper power. 
 
States such as Odisha, Bihar, Uttar Pradesh, Haryana, Punjab, Delhi, Rajasthan, Chhattisgarh and West Bengal are holding back in order to protect their already stressed distribution utilities, as the cost of power being sold by the IIPs is almost 50 per cent cheaper than that of State Electricity Boards. 
 
For instance, Jindal Power is ready to offer 585 mega watt (MW) electricity at Rs 3.69 a unit to the Railways, which will result in savings of Rs 1,100 crore annually. Jindal Power’s rates are almost 40 per cent lower than what Railways would have had to pay if it sourced electricity from the State distribution utilities of Odisha, Bihar, Uttar Pradesh, Haryana, Punjab, Delhi, Rajasthan, Chhattisgarh and West Bengal, where the average tariff for sale is around Rs 6.3 a unit.

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