25 September, 2002 – India’s federal government has convened a meeting today of the Maharashtra State Electricity Board (MSEB), National Thermal Power Corporation and GE Capital in an attempt to find a way of re-starting power generation at the Dabhol power plant.

The 2.9bn 740 MW gas-fired power plant has stood idle since June 2001 after a dispute between operator Enron and the MSEB over payments for power. Enron’s 65 per cent interest is currently being auctioned off with the Industrial Development bank of India (IDBI) overseeing the sale, as the project’s lead creditor.

“This is just a parallel step we are trying to take in the process of restarting the plant. First and foremost condition remains that MSEB and IDBI-led lenders will have to reach a consensus on tariff”, Union Power Secretary R V Shahi is reported as saying.

GE, which has a 10 per cent equity in the project, has expressed its objections to federal Power Minister Anant Geete’s statement about restarting the project within two-three months, saying that the technical aspects needed to be assessed first. According to officials, GE has written a letter to Geete and Finance Minister Jaswant Singh saying that overhauling and maintaining a plant that has sat idle for a such a long period would take more than a year. “But in the manufacturing of the plant, GE is the main supplier of the equipment and their support is necessary in restarting the project and hence tomorrow’s meeting in this regard.”