New Delhi: Former Union power minister R.K. Singh doubled down on allegations that a thermal plant awarded to the Adani group in Bihar will cost losses worth Rs 62,000 crore, and said he raised the matter with the state government but was told that “everything was hunky-dory”.
According to Singh, the thermal plant project in Bhagalpur’s Pirpainti village was awarded to the Adani group at an inflated price that will burden the Bihar government with an annual loss of Rs 2,500 crore, which would amount to Rs 62,000 crore over the 25-year agreement period.
Singh, who has been at odds with his own party – BJP – over the past year asserted that any disciplinary action against him will “only prove” that it is “hand in glove” with corrupt people.
Instead, Singh told ThePrint, he expects “appreciation” for “raising questions” about the Bhagalpur project.
‘Not a crook to ignore allegations’
Singh said he approached Bihar energy minister Bijendra Prasad Yadav after receiving information from a whistleblower on the alleged scam.
“When I received this (papers from the whistleblower), I reached out to the minister of power. He said everything is ‘hunky-dory’. I asked him to send me papers (about the project). He didn’t,” Singh said.
“Hum apne mann se to nahi gaye. Humaare paas whistleblower ka chitti aaya. Toh hum koi chor hain ki hum leke baith jayenge usko?… Raj sarkar usko ignore karti hai toh hum kya kare (I did not approach the state government on my own. I received a whistleblower’s letter. Am I a crook that I should have ignored the allegations… If the government ignores the matter, then what can I do),” Singh asked.
The former Union power minister said he couldn’t stay silent on the issue.
“I am not that kind of a person (who stays silent),” he said, adding that when the state government ignored his concerns, he had no choice but to make the matter public.
‘Not attacking the party’
Asked if he expects disciplinary action from BJP following the allegations, Singh drew a distinction between the party and individuals allegedly involved in corruption.
“The party claims they are honest. The party claims it will give an honest government – ‘Na khayenge, na khane denge (will govern transparently and won’t allow any corruption)’… This is not against the party. This is against particular people who have sold the state. How is the party involved? I’m not attacking the party,” Singh said.
Singh’s allegations mark his latest run-in with his own party and the BJP-backed JD(U) government in Bihar.
In October, he asked Bihar’s deputy chief minister Samrat Chaudhary, health minister Mangal Pandey and Bihar BJP president Dilip Jaiswal to respond to accusations raised by Jan Suraaj Party leader Prashant Kishor ahead of assembly elections in the state.
Kishor alleged that Chaudhary lied about his age and education in the poll affidavit, and Pandey and Jaiswal were named in corruption and cheating cases. The three leaders denied the accusations.
Singh, who contested the 2024 Lok Sabha election from Ara constituency of Bihar, had claimed last year there was a conspiracy that led to his poll defeat. He said he had shared the names of those behind the plot with BJP’s senior leadership and warned that the NDA alliance should not field those individuals in the Bihar elections, failing which he would “act accordingly”.
Singh told ThePrint that if BJP takes action against him for exposing corruption, it would only prove the party’s complicity.
“It (disciplinary action) will only prove that, yes, the party is hand in glove with corrupt people…If the party’s philosophy is zero tolerance, they should pat me on the back,” he said.
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The allegations
Singh said his assessment on setting up thermal power plants and procuring power shows that fixed cost in the agreement for the Bhagalpur project was substantially higher than normal rates.
Fixed charges in power bills (counted in units of kilowatt-hour) are calculated based on a company’s capital expenditure in running a power plant. Singh asserted that the average cost of setting up a power plant ranges between Rs 9 crore and Rs 10 crore per megawatt.
“The Government of India first estimated the cost at about Rs 21,900 crore, about Rs 9 crore per megawatt. The total capacity (of the planned project) is 2,400 megawatt. The state government said the project will cost about Rs 24,000 crore. Now that comes to Rs 10 crore per megawatt,” Singh said.
The fixed cost for the plant should be Rs 2.75 per unit, instead of Rs 4.16 per unit, as was decided in the agreement, Singh said.
“I got the assessment done by experts who understand the calculation of setting up power plants. They are of the opinion that only if you take capital cost at Rs 14.5 crore per megawatt, then fixed charge comes to Rs 4.16 per unit… If capital cost is Rs 10 crore per megawatt, fixed charge comes to Rs 2.75 per kilowatt hour,” Singh said.
“That is Rs 1.41 (per unit) more than what it should be,” he added.
Singh explained that plants running at 85% plant load factor (PLF) can produce around 1,787 crore units of power per year. PLF is the ratio of average energy produced by a plant compared to its maximum capacity over a period of time.
“1,787 crore multiplied by Rs 1.41 comes to Rs 2,500 crore. Taken over 25 years (as the agreement is), it would cause a loss of around Rs 62,000 crore to the state exchequer. That’s all the fixed cost you have to pay. Even if you don’t draw power, fixed cost has to be paid,” he said.
The whistleblower’s accusations
Singh said he received the whistleblower’s letter around 15-25 days ago.
“He makes some points. First, 1,020 acres of land has been given free of cost, only at one rupee… Giving land free would be a scam if that does not result in lower tariffs. Second, the rate at which the contract has been signed is very high,” the former Union minister said.
The Bihar Cabinet, in its meeting on August 5 this year, decided to lease the land in Pirpainti to the lowest bidder at Re 1 per year for either 33 years or the duration of the power supply agreement (PSA), whichever is earlier.
According to details submitted by Bihar’s energy department to the state’s electricity regulatory commission, the tariff for the plant was decided through a reverse e-auction.
Among four bidders, Adani Power made the lowest bid – of Rs 6.075 per kilowatt hours. The second lowest bid was by JSW Energy Limited, the submission shows.
After this process, the state government and Adani Power signed a PSA agreement in September for the plant. Under it, the firm will develop three thermal plants of 800 megawatt each, with deadline for production for the first plant set for Diwali 2028.
Another key allegation Singh raised was that the Pirpainti project wasn’t too far from Kahalgaon plant run by National Thermal Power Corporation (NTPC).
Singh said infrastructure necessary for running a power plant—such as the merry-go-round (MGR) railway line—already exists for the NTPC plant. If NTPC was awarded the Pirpainti project, capital expenditure would have decreased, reducing the price of power by at least one rupee per unit, he argued.
“The MGR, which connects Kahalgaon, is a dedicated railway line from the coal mine to the plant. The same MGR would have served for this (Pirpainti). That cost would have been avoided if you had given it to NTPC,” he said.
“Now, that infrastructure set up by NTPC will probably be used by Adani,” Singh added.
‘Entire process transparent’
A spokesperson for Adani Power refused to respond to a detailed questionnaire on the matter sent by ThePrint.
Singh’s accusations set off a political controversy as voting for Bihar assembly elections concludes on 11 November. Results to the elections are expected on 14 November.
Congress leader Pawan Khera last week accused the government of orchestrating the alleged scam to favour Adani group. Khera claimed the Union government had altered policies and taken Cabinet decisions to favour a single industrialist, pointing out that the move offered no benefit to Bihar.
On the accusations, Bihar energy minister Bijendra Prasad Yadav said Monday the process for awarding the project was “transparent”.
“The company that bid the lowest (amount) in the tender was selected. The decision was taken in the interest of the state,” Yadav said.
(Edited by Prerna Madan)
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