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

State Reports (Vol.-III)
Study on `Impact of Restructuring of SEBs’
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DISCUSSIONS ON HAVING ONE OR MORE DISTRIBUTION COMPANIES
Having taken the first step in forming a separate DISCOM and observing its working
for a period of one year, it is time to review whether one large DISCOM for the entire
State is the only solution or more than one company would serve the interests of
consumers as well as the electricity sector itself, in a better way. With this in view, the
following points are put up for detailed discussions/decisions.
• MSEDCL with its large network and over 69,000 staff is still unwieldy from
consideration of effective management and can still be termed a single large
monopolistic entity.
• Specific problems of operations, problems faced by consumers, their
expectations of services and solutions to be adopted to meet these could differ
from area to area. For example, from considerations of restricting areas affected
by interruptions and thus limiting loss of revenue in a paying
industrial/urban/commercial area, there is a need to increase the number of HT
sub-stations/HT feeders, reducing the maximum length of an HT feeder.
Consumers in urban/industrial area have very high expectations of interruptionfree
service and time for rectification of interruptions, of maintaining voltage
variation at consumers’ end strictly under limits, etc. These consumers are ready
to pay a higher price for prompt services. Whereas in rural areas, spreading
coverage of electricity supply may have a higher priority.
The above explains only the present respective priorities of consumers located
differently and is not meant to say that rural areas do not need or deserve prompt
services or that the intent is to create an urban/rural divide. Consumers’
expectations of services in each type of area differ. These need to be recognised
and addressed separately. One large system/company may not be the only answer
from these considerations.
• In view of the above, it needs to be examined whether another company for
urban and MIDC areas could prove beneficial from considerations of improving
financial positions, address faster improvement of services in areas, etc., with
differential tariff. Since if such a new company is formed, it will still be
completely owned by MSEBHC (owned by the Government of Maharashtra),
better profits from this new company will not be at the cost of rural areas.
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