Reliance Power Ltd. has rebutted allegations that it has received undue financial benefit when the government allowed it to use surplus coal from one project in another project.

According to the Comptroller & Auditor General (CAG), Reliance Power enjoyed an undue financial benefit of Rs 29,033 crore by using surplus coal approved for the Sasan ultra mega power project into the Chitrangi power project, which is situated nearby Sasan. The CAG also alleged that Reliance Power benefited unduly as the surplus coal reserves were not disclosed to other bidders such as Tata Power and NTPC.

But, Reliance Power chief executive JP Chalasani argued that the tariffs of the Sasan power project and Chitrangi power project would be analogous if compared on a like-to-like basis.

He said the differential between tariffs of the two power projects was primarily due to fuel costs as the latter would receive just around 40 per cent of its requirement from Sasan power project, and purchase the rest from the market.

Defending the company, he explained "If we use coal linkage from Coal India for the Chitrangi Project, we would not have much different costs than using our surplus coal."

Chalasani also said that whatever Reliance Power did was in accordance with the decision taken by the empowered group of ministers (EGoM), and the company's move to use the surplus coal was also supported by the Madhya Pradesh government.