To
Shri T V Somanathan
Cabinet Secretary
Government of India
Dear Shri Somanathan,
I refer to my letter of 23rd November 2024 addressed to the Finance Minister , calling for setting up an independent judicial commission to enquire into the respective roles of the Central agencies, especially the Ministry of Power (MOP), SECI, CERC, State Regulatory Commissions, SEBI and CBI, for their deliberate acts of omission/ commission, causing a huge loss to millions of electricity consumers across the country, tax-payers and investors, when public functionaries at the Centre and in the States connived with the Adani and Azure Groups to allow those groups to profiteer at the cost of the people.
Centralised solar power generation is inherently uneconomical:
On the face of it, any right thinking person would question the Centre’s and States’ deliberate efforts to allow corporate entities to set up more than 70,000 MW of centralised solar power plants that operate at low capacity utilisation factors, based on long-term, one-sided agreements, linked to technologies that will soon become obsolete and expensive, which occupy huge extents of land (https://www.adanigreenenergy.com-Adani Group’s Khandwa plant in Gujarat occupies 538 sq km, 30 times larger than the city of Paris!), which necessitate enormous investments on long transmission lines involving high transmission losses, in preference to setting up those very same millions of solar panels in the hands of consumers to get solar electricity at much cheaper costs and earn income from selling energy to the grid.
For enabling private corporates to produce such highly expensive solar electricity, both the Centre and the States went out of the way to give large extents of land at concessional prices, to give undue tax benefits and huge subsidies in the name of PLI/ Viability Gap Funding (VGF), all at the cost of the public at large. The motive underlying such an imprudent policy cannot be anything other than to allow the corporates to earn profits at the cost of the public.
This in itself calls for a discussion in the Parliament and a public enquiry.
New facts coming to light:
While the cheer leaders of the NDA government have tried to trivialise such an egregious scam by saying that the US court indictment amounts to intruding into India’s sovereign domain and the scam is limited to a few opposition States, trying to hide the more decisive role played in it by Central agencies, there are more and more skeletons tumbling out of the Centre’s closet, as new facts, hitherto suppressed, are coming to light.
Waiver of transmission charges by MOP to “sweeten” the Adani deal to DISCOMs at the cost of the tax-payer:
MOP, vide its order No. 23/12/2016-R&R dated 30-11-2021 waived the transmission charges for transmitting the Adani power to DISCOMs https://powermin.gov.in/sites/default/files/uploads/Orders/B.4.3.1.pdf) in suppression of its own order GSR No. 711(E) dated 1-10-2021 and other guidelines, to make it look as though the Adani power is cheaper by Rs 0.80/ unit. Considering that the Adani agreement would last 25 years, this implied a total cost of Rs 31,500 Crores to the tax-payer of this country, just to grant undue benefits to the Adani Group. The timing of the waiver just prior to SECI signing the impugned agreement with AP raises concerns of patent impropriety on the part of MOP
SECI’s transfer of 2,333 MW of power commitment illegally repudiated by Azure to the Adani Group, without competitive bidding, in violation of Section 63 of the Electricity Act, 2003:
SECI recently transferred 2,333 MW power illegally repudiated by Azure to the Adani Group without calling for fresh tenders, in violation of Section 63 of the Electricity Act, 2003 (https://m.economictimes.com/industry/renewables/seci-took-sgs-legal-nod-before-moving-power-project-to-adani/amp_articleshow/115981541.cms). Competitive bidding could have enabled SECI to get bids at a lower price range, in view of the recent improvements in solar PV technology and the present global market conditions. This precluded electricity consumers from deriving such a benefit. This shows a clear bias on the part of SECI in favour of the Adani Group.
In addition, it is not clear whether SECI has initiated legal action against Azure. Azure is liable to be penalised for unilaterally quitting the deal.
While selecting the Adani Group in the deal under question, did SECI follow a transparent competitive bidding procedure?
Rule 151 and Rule 175 of the General Financial Rules 2017 (GFR) mandate SECI to incorporate an “Integrity Clause” in agreements with private players. It is not clear whether SECI’s agreement with the Adani Group has such a clause. This calls for an investigation.
Moreover, the procedure that SECI seemed to have followed in the specific case of the Adani deal in question suggests that it was tailor-made to suit that Group.
“Throughout the tender process in the case of selection of the Adani group in the deal under question, SECI repeatedly amended clauses and deadlines, ostensibly to accommodate ‘market conditions’. For instance, under the manufacturing linked component, SECI allowed developers to commission capacity within 48-60 months— far longer than standard timelines. Moreover, SECI introduced lenient definitions of ‘domestic manufacturing,’ enabling companies to import semi processed components and pass them off as ‘Made in India’. Adani Group capitalized on these provisions, establishing its manufacturing unit under the tender and securing commercial operational date (COD) certificates despite allegations of minimal value addition in India” (https://www.businessworld.in/article/secis-double-standards-not-showing-the-rule-book-to-adani-540526#goog_rewarded)
This above accusation is far too serious for it to be ignored and only an independent investigation by the Central investigating agencies will reveal the factual position.
What next?
Pending an independent judicial enquiry, the government should impose a moratorium on the setting up of new centralised solar power plants and direct the Central investigating agencies to investigate each one of the above prima facie improprieties
Reluctance on the part of the government to set up a judicial enquiry and, pending the setting up of such an enquiry, failure to order an investigation by Central investigating agencies into the facts that emerged out of the recent US indictment and also the above cited accusations would inevitably lead to the inference that the Centre is in league with those who had a part in committing the improprieties.
Regards,
Yours sincerely,
E A S Sarma
Former Secretary to the Government of India
Visakhapatnam
