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

Synopsis of State Reports (Vol.-IV)
Study on `Impact of Restructuring of SEBs’
namely ERC Report, Maharashtra Electricity Reform Report (draft) and
Government of India’s Electricity Bill, 2001 for preparation of the White
Paper. Officials from MSEB visited the States that had undertaken reforms and
gave their suggestions. The Minister in-charge of Energy held wide-ranging
discussions with various stakeholders. As a result of these efforts, the following
options of reforms emerged:
i) SEB to retain its existing identity with generation, transmission and
distribution to be run as profit centres.
ii) Corporatisation of MSEB without restructuring.
iii) Restructuring and corporatisation of the reorganised entities of MSEB.
iv) Restructuring and corporatisation of the reorganised entities of MSEB,
followed by privatisation of distribution entities.
Government of Maharashtra presented the White Paper in the State Legislature
in August 2002. It highlighted the condition of the power sector in the State
and the urgent need of reforming MSEB. It also spelt the Government’s
strategy for reform in the power sector, aimed at meeting consumer interests
while addressing concerns of the employees. Government of Maharashtra
promised not to totally withdraw from the sector but to bring efficiencies in the
sector to enable it to become self-sustaining.
10.5 MEASURES OUTLINED IN THE WHITE PAPER
The reform process proposed in the White Paper incorporated the following
major elements:
i) Internal Reforms: This included development of human resources,
reduction of T&D losses, prevention of theft of electricity, energy audit
and metering, demand side management, redressal of consumers’
complaints and improvement of consumer services;
ii) Independent Regulatory Framework: Government should withdraw from
regulation and operation of the power sector and eventually from the
ownership of certain segments of the sector;
iii) Restructuring of MSEB into generation, transmission and DISCOMs and
establishment of a holding company (under the ownership of the State);
iv) Continued Government support to poorer sections in rural areas; and
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