In a letter dated January 1, 1999 the Goa Pollution Control Board informed the company that it had been denied clearance to commence the 48 megawatt (MW) project.

Interestingly, the Pollution Control Board was dissolved when the Luizinho Faleiro government took office in November 1998. A new board is yet to be constituted. This puts the Pollution Control department directly under the minister.

Reliance-Salgaocar Power Company, the first private power producer in Goa is schedule to produce 38 MW under the open cycle process and another 10 MW under the closed cycle process. However the Purchase Agreement signed by the state government and the company states that the closed cycle process would go on stream six months after the open cycle process power generationcommences.

However, the strong environment lobby has objected to the high temperatures around the power plant when the open cycle process is alone employed. In its own submission, the Reliance-Salgaocar combine has stated that the temperature around the plant would rise to 560 degrees Celsius. The heat energy given out by the open cycle project would be channelised to generate an additional 10 MW of power under the combined cycle.

The project which was scheduled to go on stream in September-October has been delayed primarily on environment grounds. Construction on the first phase of the project is complete and the combined cycle plant is scheduled for completion by April this year. However, sources say if the green signal is received, the company would be able to supply power within 72 hours.

But the state government has to balance the need for cheap power (at Rs 3 per unit) with environmental considerations. The plant is located on the mouth of the Zuari river which therefore raises several ecologicalquestions.

Currently Goa faces a severe power shortage and a Bombay High Court order prohibits the state government from issuing new power connections.