Separate levy of water tax and energy-loss charge

Last Updated: Tue, Aug 07, 2012 19:12 hrs

A state government committee created for policy formulation on reservoir water use by industrial units has decided that the industries will have to pay water tax and hydro-energy output loss charges separately to the Water Resources Department and Odisha Hydro Power Corporation (OHPC), respectively.

At present, industries are paying water taxes and energy compensation levy to the Water Resource department as per their agreement with the department based on a policy framed in 1992.

The panel decided that the water resources department will adjust the entire money collected as payment made against water tax and OHPC will have to claim its dues towards energy output loss compensation separately.

“OHPC will submit separate bill to individual industries for recovery of arrear and current energy compensation. The industries will compensate OHPC on actual water drawal before 2006,” the committee headed by Chief Secretary decided recently.

As per the new decision, the benchmark rate of energy compensation charges will be Rs 3 per unit for the 2005-06, and the rates will rise 10 per cent every year for calculation of charges in subsequent years.

“We are waiting for the Directorate of Water Resources to send us actual water drawal report by industries before 2006, so that we will send the bills to individual industries,” said an official of OHPC.

The committee decision follows a High Court order in the power tariff hike case in 2011-12. The court had directed the state energy department, Gridco and power distributing companies to collect pending water bills and power tariff bills from consumers, saying that the huge outstanding bills were putting additional financial burden on the power supplying utilities and was a key reason for tariff hike.

The latest decision is likely to affect steel, power, mining industries which use large quantities of water for their operation.

In February this year, a written reply furnished by Chief Minister Naveen Patnaik in the state assembly said 16 large industries which together owe Rs 1,422.04 crore of water tax, have not paid the dues and instead, have filed 24 cases in the Orissa High Court.

In total, 251 industries in the state, including big corporate houses like National Aluminium Company (Nalco), Tata Steel and Paradeep Port Trust (PPT), owe Rs 1,634.71 crore (as on September 2011) to the government by way of water cess.

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