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

Synopsis of State Reports (Vol.-IV)
Study on `Impact of Restructuring of SEBs’
In the present scenario, it is unlikely that Government would withdraw
completely from the power sector. The way forward would be for the
Government and the Utilities, to have mutually agreed areas relating to
managerial and financial autonomy and accountability to achieve targets and
goals of efficiencies/performance over a defined period. It should be on the
lines of MoUs/MoAs, which are in vogue in some CPSUs.
At the time of restructuring, unfunded liabilities, on account of pensions and
provident fund bonds, stood at Rs 673 crore and Rs 376 crore for HVPNL and
HPGCL respectively. Such unfunded liabilities should have been retained by
the State Government as was done in other States, which had restructured their
SEBs. Due to the burden of unfunded liabilities, the above Utilities have been
denied the opportunity of commencing their operations on a clean slate and on
a sound financial base.
There is a need to reconsider FRPs for the Utilities, which would provide for
specific flow of any additional revenue support to the Utilities and meeting the
obligations to achieve the targeted AT&C loss levels. This would obviate the
occasional ad-hoc support that the State has been providing in the form of
waiver scheme, etc.
Government agencies owe huge amounts to the DISCOMs for the electricity
consumed by them. Thus there is a need for a separate budget provision, so that
the DISCOMs receive their dues. The same should be reflected in the State
budget sub-head, with a clear provision that the funds provided for such a
purpose shall not be diverted for some other purpose.
For improving the ageing network infrastructure in rural areas of Haryana,
which were created as early as in 1970s for achieving 100 per cent rural
electrification, the funds under the Rajiv Gandhi Gramin Vidyutikaran Yojana
(RGGVY) should be tapped. This would help in stabilisation of retail tariffs
and reduce the burden of cross-subsidisation on other category of consumers.
This may have to be taken up by the State Government so that the benefit of
this scheme gets extended to the DISCOMs in the State.
The DISCOMs depend for support of the State machinery for enforcement
measures to curb the theft of electricity, which is endemic. The experience of
AT&C loss reduction in States like Andhra Pradesh shows that enforcement
measures with State support produce positive results. The State should have a
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