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

National Report (Vol.-II)
Study on ‘Impact of Restructuring of SEBs’
targets. Rural Electrification Programme should not be seen as adding yet
another burden of losses on the Utilities through conventional technical system
extension.
G. Other Findings
G1 One of the major gains of the process of restructuring is the improved
commercial performance of the Utilities. The losses which were on the increase
until 2001-02, started diminishing after that, and came down from Rs 29,252
crore in 2001-02 to Rs 21,998 crore in 2004-05. (The losses may have been of
the order of Rs 38,000 crore if allowed to continue in a ‘business as usual’
mode.) Similarly, the States (excluding Uttar Pradesh) that have restructured
their SEBs have registered profits (with subsidy), after 2003-04. Further,
excluding Rajasthan and Uttar Pradesh, these States together have substantially
reduced their ratio of commercial losses (without subsidy), to revenue. The
percentage of subsidy as a ratio of respective revenues has also come down in
some restructured States, which is a positive indication.
G2 In the performance ratings secured by the Utilities for 2005, several
restructured States occupy fairly high rankings. It is pertinent that three such
States have been assigned top positions. However, the lower than expected
performance of some others highlights the need for improving the working of
the restructured Utilities by securing strong political commitment, improved
management practices and better financial and management controls, etc.
H. Findings and Recommendations
H1 Based on the extensive Statewide reviews and analyses, a large number of
important recommendations have been included in this Report for necessary
follow up by the Ministry of Power, Government of India, and the concerned
State Governments. These have been categorised separately for the use of the
intended stakeholders as ‘Way Forward’ in a subsequent chapter. The major
recommendations are as follows:
i) Need for sustained political commitment and support for the reform;
ii) Need to issue Detailed Policy Statements (DPS) to spell out the future
policy and programmes;
iii) Need for an effective and forceful communication strategy;
iv) Need to make available excellent, competent consultancy support to the
State Governments;
7