With the Empowered Group of Ministers (EGoM) scheduled to meet on February 23 to consider the “legal opinion’’ on the issue of diversion of coal by Reliance Power Limited (RPL) in Sasan and Tilaiya ultra mega power projects (UMPPs), confusion prevails in the Power Ministry over the actual quantum of loss as the initial estimates have been revised three times by the Comptroller and Auditor of General (CAG).

Officials in the Power Ministry point out that the CAG has revised the alleged windfall gains to Reliance Power by almost 87 per cent in its latest estimates. A draft audit report by the CAG on allocation of coal blocks and augmentation of production in January quantified the undue benefit to Reliance Power at Rs. 24,266 crore calculated from the two UMPPs of 4,000 MW each. While the Sasan UMPP is situated in Madhya Pradesh, the Tilaiya UMPP is in Jharkhand for which captive mines were allocated by the Government.

However, the CAG had in August 2011 pointed out that government had favoured Reliance Power by allowing it to use surplus coal from the captive mines of Sasan and Tilaiya projects for its other projects. At that time, CAG had put the loss at Rs. 1.8 lakh crore. A subsequent audit report last October by principal director of audit and audit board member, M.K. Biswas then brought down the amount to Rs. 1.2 lakh crore. The latest report by principal director of commercial audit, Kolkata states: “ After deducting the cost of production from the selling price of coal per unit of a comparable Coal India mine (Piparwar project) prevailing as of March 31, 2011, the total undue benefit to RPL for Tilayia was Rs. 19,924 crore and Sasan Rs. 4,342.23 crore’’. CAG's draft report last year had quantified the gains at Rs. 42,009 crore from Sasan and Rs. 78,078 crore from Tilaiya.

However, officials in the Power Ministry said that while they were still waiting for a word from the Law and Justice Ministry on the issue, the continued downgrading of the quantum of loss had created confusion. “There is no clarity on the quantum of loss as it has been revised by almost 87 per cent in the latest report. This will have an impact on the legal opinion as continued revision of figures has led to confusion. We are waiting for the February 23 EGoM to further take up the matter,’’ a senior Power Ministry official remarked.

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