STATES URGED TO ELIMINATE ELECTRICITY BOARD
LOSSES SHRI GEETE INAUGURATES POWER UTILITIES WORKSHOP
The
Power Minister, Shri Anant G. Geete has urged State Governments
to implement a definite and effective plan to completely eliminate
commercial losses of the Electricity Board within a timeframe.
The Minister was delivering his inaugural address at a one-day
All India Workshop of Energy, Finance Secretaries and CEOs of
State Electricity Boards here today.
Shri Anant Geete
stressed the mammoth task ahead for providing electricity to consumers
at an affordable price. An ambitious plan for doubling the capacity
with an investment of Rs 8,00,000 crore over the next ten years
has been drawn up to meet the goal of "Power for all by 2012".
In order to realize this dream, the financial viability and restoration
of financial health of the State Utility is a key element. Over
the last ten years, the losses of the State Utilities have been
mounting steadily and it is estimated that the total accumulated
losses (without subsidy) is to the tune of Rs 88,000 crore.
The
Minister said that in order to restore financial viability of
the utilities the Government has placed special
emphasis on distribution reforms and an Accelerated Power Development
and Reform Programme (APDRP) has been launched with an outlay
of Rs 3500 crore for the current year. The programme aims at narrowing
down and ultimately eliminating the gap between the cost of power
and revenue realization within a specified time frame. He appreciated
the efforts of the Expert Committee headed by Shri Deepak Parekh
for suggesting reform templates for State Utilities. He felt that
the Workshop can address to the specific difficulties and the
reform approaches of each state in an effective
manner. He reiterated the Government’s commitment to power sector
reforms.
The highlights of the recommendations of the Deepak
Parekh Committee are :
q The
entitlement of funds to the States would be based on performance
q The incentive
shall be given on the basis of the actual gap reduction in the
cost of supply and revenue realisation
q The
States can choose reform models that are most appropriate to meet
challenges of the respective States
q All
stakeholders in the power sector have to be given space for participation
in the reforms process of each State.
Shri N.K. Singh, Member Planning Commission, in his
Presidential Address urged the State Governments to affirm commitment
for reforms. He underscored the need to utilise the funds provided
in this year’s budget for APDRP. He pointed out that the Government
could think of creating a non-lapsable fund for this purpose.
He emphasized that the incentives to be provided to the conforming
States should co-exist with penalties for the non-conforming States.
Shri
R.V. Shahi, Power Secretary, in his Introductory Address expressed
satisfaction at the recognition in the States for the need of
reforms. He noted that the process of reforms has gathered momentum
in most of the States and there is every likelihood that a number
of States may witness a financial turnaround in the next 3 to
4 years. He said that the States are being rated by CRISIL and
ICRA on the basis of the commitment for and the progress of reforms
undertaken by them. He said that benefits from the Center and
the CPSUs would depend upon the progress made by the individual
States in this regard. Projects for improving the distribution
network worth about Rs. 10,000 crore
has already been sanctioned by the Government,
he added.
