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

Synopsis of State Reports (Vol.-IV)
Study on `Impact of Restructuring of SEBs’
financial position had deteriorated substantially, till it was able to make
profits through sale of surplus power outside the State. Injection of capital
to strengthen the distribution system, launching a special drive to collect
arrear dues, introducing energy audit at all levels are the crying needs of
the hour.
Action Taken on the Kanungo Committee’s Report
Government of Orissa had constituted a Committee of independent experts to
review power sector reforms in Orissa on 30 May 2001. This Committee,
known as the Kanungo Committee, submitted its report on 2 November 2001.
After considering the recommendations of the Kanungo Committee and also
the correctives suggested by OERC, the State Government issued orders on 29
January 2003. The salient points are as follows:
i) The effect of up-valuation of assets of OHPC and GRIDCO, indicated in
Notification No. 5210, dated 1 April 1996 and No. 5207, dated 1 April
1996, would be kept in abeyance from 2001-02 prospectively till 2005-06
or till the sector turns around, whichever is earlier, to avoid redetermination
of tariff for past years and also re-determination of assets of
various DISCOMs. For this purpose, depreciation would be calculated at
pre-1992 norms notified by Government of India.
ii) Moratorium on debt servicing by GRIDCO and OHPC to the State
Government would be allowed from 2001-02 till 2005-06, except for the
amount in respect of loans from the World Bank to the extent the State
Government is required to pay to the Government of India.
iii) The outstanding dues, payable to OHPC by GRIDCO till 31 March 2001,
on account of power purchase would be securitised through issue of
power bonds by GRIDCO to OHPC.
iv) GRIDCO and OHPC shall not be entitled to any Return on Equity (ROE)
till the sector becomes viable on cash basis or by 2005-06, whichever is
earlier.
v) The State becomes power surplus under conditions of normal hydro
availability. GRIDCO may take steps for export of power and to procure
cheap power from CPPs like NALCO and ICCL. OHPC and OPGC may
be allowed to undertake third party sale outside the State, subject to
permission from the appropriate authorities.
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