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

10.2 FACTORS LEADING TO REFORMS
Synopsis of State Reports (Vol.-IV)
Study on `Impact of Restructuring of SEBs’
To rectify this situation, it was necessary to set up additional generating
capacity and strengthen the T&D network to meet the anticipated growth in
demand in the next ten years, requiring an estimated investment of over Rs
30,475 crore. Considering the financial health of MSEB and the necessity of
huge investments in the sector, it was clear that the State would have to
approach the Central Government and FIs to provide necessary funds.
Government of India had also taken the initiative to evolve a national
consensus for reforms in the power sector. From the deliberations and decisions
taken in the conferences of Chief Ministers of States, it had become clear that
Central Government and FIs would be helping only those SEBs, which
embarked on a reform agenda. It was thus clear that for sustaining growth of
the power sector in the State and ensuring its financial viability, it was
necessary to reform the sector.
10.3 OBJECTIVES OF REFORM
Government of Maharashtra decided to reform the electricity sector to meet the
following objectives:
(i) To promote development of an efficient, commercially viable and
competitive power sector;
(ii) To provide reliable quality and uninterrupted power supply at reasonable
rates to all consumer categories; and
(iii) To ensure that social and environmental aspects are fully taken into
consideration.
10.4 METHODOLOGY ADOPTED BY FOR REFORMS
Government of Maharashtra had constituted the State Electricity Regulatory
Commission in 1999. In February 2001, the State Government constituted an
Energy Review Committee (ERC) to review the power situation in the State
and suggest the broad future course for reforms of the power sector in the State.
As a part of process of building consensus for reforms of MSEB, Government
of Maharashtra decided to issue a White Paper on the proposed reforms in the
power sector. In April 2002, Government of Maharashtra released
advertisements in leading newspapers, inviting responses on three documents,
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