Privatise or perish, Centre tells discoms

Privatise or perish, Centre advises Discoms.

Where you have a number of suppliers in the business of providing electricity to consumers, the consumer has a choice just as you have a choice with your mobile, If I don’t like Airtel, I will switch to Vodafone.

20 per cent Power theft, 25 per cent, technical losses:

According to the Union power ministry, only about 55 per cent of the power generated in the country is actually billed.

Hyderabad: India

In a major reform measure, the Union power ministry has stated that state power distribution companies (discoms) will not get grants or loans unless they privatise their distribution networks. This is meant to offer consumers the option of choosing their power network, just as they choose their service and gas connections. Unless they privatise, discoms will not be eligible for grants or loans from the Centre or the Power Finance Corporation (PFC) and the Rural Electricity Corporation (REC).

Union power minister R.K. Singh revealed this in an interview to a magazine. Mr Singh said, “Where you have a number of suppliers in the business of providing electricity to consumers, the consumer has a choice just as you have a choice with your mobile, If I don’t like Airtel, I will switch to Vodafone.”  NITI Aayog has proposed the privatisation of power supply and the Union power ministry is in favour of this proposal.

According to the Union power ministry, only about 55 per cent of the power generated in the country is actually billed. Of the power that is generated but not billed, 20 per cent is attributed to Power theft and 25 per cent to technical losses during transmission and distribution. Against this backdrop, the Union power ministry opined that the only effective solution to power theft and inefficiency that leads to enormous losses during transmission and distribution is privatisation of the distribution network.

The Centre gives funds through PFC and REC to discoms to install smart meters, aerial bunch cables, underground cabling and supervisory control and data acquisition (SCADA) systems. Mr Singh said that in the future, discoms will get funds from the Centre, PFC or REC on achieving certain parameters and reforms after reaching the milestones.

The All India Power Engineers Federation (AIPEF) has strongly opposed the arm-twisting tactics of the Union power ministry. AIPEF chairman Shailendra Dubey said that the power ministry has threatened discoms that they will have to hand over the electricity supply business to multiple supply licenses or franchisees to get central government assistance or loans from the PFC. He said that since electricity is a concurrent subject, the central government cannot dictate terms to state governments. He said that the central government policy is to safeguard the interests of private power producers and dumping the state sector.[Courtesy: DECCAN CHRONICLE, SNCN Acharyaulu]


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