The State government on Tuesday denied any wrongdoing in the allotment of fly ash by coal-fired thermal power stations to cement companies.

Responding to a special call attention motion from a number of parties in the Assembly, Law Minister Durai Murugan, speaking on behalf of ailing Electricity Minister Arcot N. Veeraswami, said cement firms were being provided fly ash at a rate higher than that prescribed by the Union government.

Over the years, the revenue netted by the Tamil Nadu Electricity Board (TNEB) was on the rise, he said, reacting to the observation of C. Gnanasekaran (Congress) and G.K. Mani (Pattali Makkal Katchi) that a loss of Rs.450 crore was being incurred annually.

In August 2003, the Union Environment and Forests Ministry issued an order, permitting thermal power plants to give fly ash free of cost to those engaged in the production of cement, bricks and concrete blocks.

At a time when fly ash was piling up at the stations, the Board entered into a memorandum of understanding with cement firms for the establishment and maintenance of pressurised dense fly ash disposal system.

Under this, firms would utilise 80 per cent of the fly ash. The remaining 20 per cent could be given on first-come first-served basis.

Initially, service charges of Rs.60 per tonne were levied. In November 2009, the Centre issued an order, stipulating charges for three types of users. For those who had set up the disposal system and those who had not established it, the per tonne charges collected by the TNEB were Rs.250 and Rs.350, against the prescribed rates of Rs.200 and Rs.300.

In the case of brick manufacturers, the Board was collecting Rs.100, as recommended by the Centre.

An amount of Rs.10 crore was earned in 2004-2005; Rs.11 crore in 2005-2006; Rs.14 crore in 2006-2007; Rs.16 crore in 2007-2008; Rs.17 crore in 2008-2009 and Rs.42 crore in 2009-2010. This year, it was expected to be Rs.78 crore, the Law Minister said.

Responding to the legislators' comment that fly ash was being sold in the open market at Rs.1,500 per tonne, Mr. Durai Murugan wondered how this could be so when the Board was purchasing coal at a cost of Rs.2,100 per tonne.

On Congress whip Peter Alphonse's suggestion for increasing the quantum of allotment to small scale industries, such as hollow block manufacturers, the Minister replied that a case filed by an association of brick manufacturers was pending before the Madras High Court.

To PMK whip T. Velmurugan's suggestion that fly ash be auctioned to fetch more revenue, Mr. Durai Murugan said this would require the approval of the Union government. However, the matter would be discussed with the Chief Minister before deciding to approach the Centre.