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

State Reports (Vol.-III)
Study on `Impact of Restructuring of SEBs’
Particulars 1959-60 1997–98
Installed generation capacity (MW) 213 7,276
Villages electrified (No.) 2,496 26,565 (100%)
No. of consumers (lakh) 2 100
No. of agricultural connections (lakh) 0.13 20
In spite of the impressive performance of APSEB, it had to face certain serious
problems in managing the power sector. Some of them were:
• Increasing revenue deficit year after year;
• Coping with un-remunerative tariffs due to lack of support from
Government for tariff revisions;
• Outstanding liabilities (amounting to Rs 2,600 crore) at the end of the
year 1997-98;
• Due to poor financial position of the Board, FIs were not willing to
provide project finances;
• Due to lack of adequate investments, the gap between demand and
supply widened;
• Power shortages which led to increased power cuts; and
• Government not providing subsidy in cash.
2.3 PROGRESS OF RESTRUCTURING
The reform and restructuring exercise in Andhra Pradesh power sector started
in June 1997 with the creation of a Reform Cell. Officers, with requisite skills
and experience (serving as well as retired) were selected and drafted to the
Reform Cell. Ten working groups were also constituted. Each group was
entrusted specific task. The reports prepared were presented to the members of
the Board for appropriate decisions. Active involvement of the members of the
Board in the reform exercise was evident from the fact that the weekly
meetings were held at Board level to review the progress of reform activities.
Secretary (Energy), Government of Andhra Pradesh also took part in these
review meetings. The process followed greatly helped in implementation of the
restructuring process.
On 1 February 1999, APSEB was restructured into APTRANSCO and
APGENCO.
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