Deviation from Gadgil formula-I: NTPC claims higher home state share necessary to beat out private developers

In danger of losing even more projects to the private sector with the advent of mandatory competitive bidding, NTPC is trying to make hay while the sun shines. It has, accordingly, petitioned the Ministry of Power (MoP) to allow it to divert higher quantum of power from its plants to their respective home states. 

• To shore up its case, NTPC has claimed that the states prefer not to allot sites for NTPC to install power projects, favoring, instead, private developers, which offer a larger share of power from their plants.
• Besides, NTPC has argued that the states should be rewarded for their contribution in the capacity addition programme of the country, as cooperation of the government is a prerequisite for acquisition of land, water allocation, state-level pollution clearance, rehabilitation and resettlement of project affected persons and maintenance of law and order in the vicinity of a power project.
• The home state also has to bear the environmental consequences of installing a power station, NTPC states in support of its contention.
• Moreover, NTPC has argued, the MoP has already set a precedent by allocating a higher quantum of power from the upcoming UMPPs to their home states, lending legal viability for a deviation from the Gadgil formula for NTPC`s stations, as well.