Mumbai: Hopes of an early restart of Enron's idle Dabhol power plant have been dashed with the Maharashtra government rejecting an offer by IDBI-led lenders for resuming purchase of power at a new rate saying that it was "unacceptable".

The offer of IDBI-led lenders to Dabhol Power Company (DPC) for power purchase at Rs 2.86 per unit of the project's phase-one was "unacceptable" and the rate should be reduced to an acceptable level, Chief Minister Vilasrao Deshmukh told reporters on September 2 night after presiding over a meeting of leaders of the ruling Democratic Front.

The government is expected to communicate its decision to the financial institutions later on September 3.

Deshmukh said that the government would like to discuss further reduction in the proposed tariff.

"We are making efforts to reduce DPC's tariff to a reasonable level. However, IDBI's condition of pass through tariff to MSEB is unacceptable," he said adding, the DF leaders were of the opinion that naphtha rates should be equivalent to that of coal instead of international crude oil prices.

The leaders also opined that Centre should waive its minimum alternate tax. IDBI, which has quoted 13.5 as its interest rates, should bring it to 10 per cent in view of the downslide in global market and the financial institution should repay loans of all foreign lenders who have extended financial assistance to the ambitious power project.

PTI