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

Synopsis of State Reports (Vol.-IV)
Study on `Impact of Restructuring of SEBs’
RSEB had succeeded in phenomenally raising the agricultural tariff under
the garb of optional scheme and thousands of farmers opted for this
scheme. The Planning Commission of India and World Bank had
profusely appreciated the scheme. Unfortunately, the scheme was diluted
gradually due to political considerations, which the DISCOMs could not
resist.
6.9 WAY FORWARD AND RECOMMENDATIONS - DISTRIBUTION
(a) Professional Directors
In order to professionalise the Boards of the power companies, it is felt
that there should be 50 per cent independent directors who could be
professionals in various fields. Presently, the Boards of all the five
companies are manned by Government nominees only. It is felt that
Power Finance Corporation, Rural Electrification Corporation and
Commercial Banks, from whom the power companies have borrowed
heavily, should be empowered to nominate their nominees as directors. In
many of the Government undertakings, non-officials have been appointed
as directors but the power sector companies do not have even a single
director from outside the Government.
(b) Agricultural Connections
i) There is a need for gradually restricting the subsidies among the
agricultural consumers only to those who really deserve. Through the
Nursery Scheme during the RSEB period, broadly a distinction could
be made between the haves and have-nots. The haves have opted for
the nursery scheme (instant connections) and willingly paid higher
charges – both capital cost and tariff. The have-nots, who were left
out, were provided connections under the ordinary category.
ii) The newly adopted annual targets of 40,000 agricultural connections
are counter-productive and not sustainable in the long run. The
traditional target of 25,000 agricultural connections should be
restored. Out of this, 50 per cent connections should be released
under the out-of-turn scheme so that the DISCOMs do not have to
subsidise the affluent farmers.
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