Report of Indian Institute of Public Administration ... - Ministry of Power

Madhya Pradesh
In regard with the RGGVY scheme, the State Government feels that it should cover
the works at voltage level of 132 kV and above for extending the supply lines to
remote villages to reduce T&D losses.
8. Lessons Learnt and Way Forward
8.1 REORGANISATION OF THE STATE
There are outstanding issues relating to transfer of assets, liabilities and staff, which
have not been resolved as yet. It is not easy for the State Government to come to a
settlement unless there is equally a positive response from State Government of
Chhattisgarh. Since these are post-reorganisation matters between the two States it
would require intervention by the Central Government to bring about amicable
settlement of the outstanding issues.
As a result of reorganisation, the availability of power has been adversely affected.
Out of a total capacity of 4,260 MW of the undivided State, 2,940 MW of generation
assets were only left with Madhya Pradesh. The State has also not taken suitable
measures to improve the condition of its generation facilities through R&M
interventions.
8.2 OPENING BALANCE SHEET OF THE UTILITIES
The Government of Madhya Pradesh has notified the provisional opening balance
sheets and cash flow mechanism to be followed by the generation, transmission,
distribution, and trading companies. Further, the companies have not finalised their
balance sheets, as the State Government has reserved the right to modify values in the
opening balance sheets. The State Government is yet to finalise the opening balance
sheets of the new generating, transmission, distribution, and trading entities. This
obviously, leads to insufficient filing of the ARRs by the Utilities with their
provisional figures of “gross block” of fixed assets and liabilities for the purpose of
determination of return on equity (ROE), depreciation and revenue gap.
8.3 LICENSE FOR TRADECO
The trading function had been retained by MPSEB until recently and has now been
transferred to MPTRADECO, which has been set-up in June 2006. This arrangement
was agreed to by the Ministry of Power as per the proviso to Section 172 (a) of the
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