Expert suggests road map after BSEB unbundling

PATNA: Bihar government is giving final touches to the much-awaited restructuring plan for the state-owned, loss-making Bihar State Electricity Board (BSEB) for paving the way for the entry of private players in the power sector.

In this regard, Sunil Wadhwa, MD of North Delhi Power Limited (NDPL), a joint venture between Tata Power and Government of Delhi for power distribution, gave some tips to Bihar for a turnaround in the power scenario after the BSEB unbundling, during his visit to Patna last week. He said that Bihar’s situation was similar to that of Delhi at the time of unbundling of Delhi Vidyut Board (DVB) in 2002. He also made a power-point presentation here before energy experts and government officials.

Talking to TOI, Wadhwa stressed the need for robust energy accounting and auditing practices. He said a large number of unmetered consumers, old and worn-out distribution network, high transformer failure rate and cumulative losses to the tune of Rs 5,000 crore at the end of FY10 have made the situation bad in Bihar.

He favoured the creation of a company under PPP mode, with private player having a controlling stake. Day-to-day management of the company should be with the private player and government oversight should be through board nominees.

Talking about the addition of generation capacity, he suggested exploring hydel/pumped storage opportunities in the state. He also made a plea to explore renewable energy potential of the state through distributed generation (by rice husk/solar power etc), which have an estimated potential of 800mw.

The corporatisation and restructuring of BSEB was essential to ensure targeted attention on loss-making segment, he said. “Power distribution is the weakest and most critical link as it is revenue generating (and losing). Only a viable distribution sector can support generation capacity addition/sourcing power through long-term power purchase agreements (PPAs) to meet power deficit,” he said.

Wadhwa also termed the franchisee tenders in Bihar as unrealistic. “The targets for cutting transmission losses in Patna from 43.4% to 15.4% in three years and from 43.4% to 11.4% in 10 years are unrealistic. Neither tariff increase nor increase in demand leaves any margin for franchisees to meet operating and capital servicing costs,” he said. Franchisees are expected to meet their expenses and earn profits only through overachievement of transmission loss reduction targets, which is unrealistic, he said.

Source: TOI

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