Maniyar project row: KSEB informed govt of contract violation by private company

Thiruvananthapuram: The Kerala State Electricity Board (KSEB) has found that Carborundum Universal Ltd, the operator of the Maniyar small hydroelectric project, violated the terms of their contract with them.

The contract, signed on May 18, 1991, included specific provisions that were breached by the company. In a supplementary contract signed in 1995, the company was obligated to sell electricity to KSEB at a rate equivalent to the charges levied by the board from Extra High Tension (EHT) consumers.

In December 2022, the then-chairman of the Electricity Board, Dr. Rajan Khobragade, wrote to the Kerala government detailing the violations from the private company. According to the board, after the introduction of the Open Access system in 2003—which allows consumers to purchase electricity from producers directly—the company continued to produce and sell electricity in violation of the contract. Amid these findings, Kerala Government decided to extend the contract of the project. 

The company had been granted permission to operate the Maniyar hydroelectric project as a captive power plant, meaning the electricity produced was to be used exclusively for its own industrial needs, with the remaining electricity to be supplied to the electricity grid of the board.

However, after the Open Access system was implemented, the company failed to comply with these terms. Instead of supplying electricity to the grid as required, the company began procuring electricity from outside sources at lower rates, sometimes operating without using the Maniyar project altogether and purchasing power directly from KSEB.

Despite these breaches and allegations of misusing the project for its own profit, the government extended the contract for an additional 25 years, without addressing the violations pointed out by the board.