The blacking out of Enron

How serious was the Maharashtra chief minister when he mentioned environment as a reason for scrapping the gas-based Enron project?

Last Updated: Saturday 04 July 2015

-- WHILE scrapping the 2,015 mw, Rs 9,050-crore Dabhol Power Company's (DPC) Enron project, Maharashtra chief minister Manohar Joshi cited the lack of environmental con- cerns in its plan as one of the grounds for his drastic move. But energy and development experts like Kirit Parikh, director, Indira Gandhi Institute of Development Research, Bombay, and Amulya K N Reddy, director, International Energy Initiative, Bangalore, emphasise that the hitches are financial and procedural impropriety, not environmental.

"In this case, environmentalists deserve no sympathy," says Parikh, who had raised cudgels against the Enron project in April 1993 on economic grounds. He questions the Maharashtra government's wisdom of dragging invalid environmental arguments into a controversial decision.

Says Parikh, "When projects based on - coal, nuclear energy and hydel power are being opposed on environmental grounds, what are we left with? The cleanest available option is gas. At this stage, the government should have allowed the project to go on with renegotiations on costs."

The country's power needs are shooting up, necessitating an expansion at an annual growth rate of installed capacity of 9.85 per cent, points out Reddy. An eminent energy expert, Reddy does not see the Enron project as a long-term solution to the energy crisis, but gives an almost clean chit to the company on the environmental count.

But Manohar Joshi, while announcing. the scrap decision, told the state assembly on August 3, "The tragedy of all environmentaf -tiscussions so, far as been that, instead of considering the environmental impact, Z70-timlle has been spent discussing how gas as a fuel is less environmentally harmful compared to coil."

Going by the available studies on the DPC, Joshi's statement is rather baseless, far even environmentalists consider glas-base4, units the cleanest after hydel units. @1@ Union ministry of environment and forests (MEF) green signalled the project in November 1994 after clearance from a High Court-hppointed expert committee. Then the MEF accepted the D's Environmental Impact Assessment (EIA),report showing only a nominal increase in air pollution levels. The project's critics dismiss several of these studies. Alleges Debi Goenka of the Bombay-based Society for Clean Environment, "So far, no EIA has been made public." He says the DPC would lead to the Konkan belt's largescale industrialisation, causing further pollution and displacement. Former Congress chief minister Sharad Pawar had a Rs 65,000-crore industrial development plan for this region, according to press reports.

Parikh agrees that despite the lower air pollution levels, the project does raise more vital issues regarding thermal pollution and safety, and shift in land use patterns.

As the DPC would pump out into the sea about 90,000 cubic in of hot water per day after the cooling cycle of the plant raising the sea water temperature by 5 Celsius, it can possibly affect marine life, especially spawning fish. However, the Dpc newsletter Dabhol Samvad claims that as water would be released at the rat of 1 cubic m/second, its temper atura4ill become same as the sea water within,@ e 15 in radius. "No difference 41 be- It beyond a circular zone of 30 4 diairifter," the newsletter said.

However, Reddy is strident in his opposition, "Any solution, such as Enron, which does not result in improving the technical and financial performance of the associated state electricity board, is a wrong solution and must be rejected." He adds, "Similarly, any solution that undermires rather than strengthen the capacity and human resources of the indigenous electrical equipment industry is an unacceptable solution." In long-term perspective, he says that "the genuine solution to the crisis of the electricity system is a shift to the new energy paradigm, with the emphasis changing from energy consumption to energy services as an index of development."

Parikh criticises the way the project agreement was reached, without comparative bidding, allowing unchecked cost escalation. He says that the government should have let the project to go ahead at this stage, cuttirig, down capacity charges so that per unit energy charge could be reduced.

The question is whether or not a government can raise invalid envionmental arguments to score a political point over its predecessor. Joshi, during his tenure as mayor of Bombay, had coined the slogan "Clean Bombay Green Bombay". Still, industrial belts in and around Bombay remain an open dumpyard for hazardous wastes, and rivers and creeks are dying. The government's coalition partner, Shiv Sena supremo Bal Thackeray, is not very vocal about this or the plight of the Maharashtra oustees of the Narmada project. Obviously, sloganeering of his kind is not necessarily based on facts or a strong will.

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