Assam has hinted to privatise power distribution in the state in near future as part of second leg of power sector reforms.
Assam power minister Pradyut Bordoloi on Thursday said that though the first generation of power sector reforms had improved the power scenario in the state, a lot still remains to be achieved. He advocated that the role of private sector need to be increased in the power sector of Assam.
“We will have to go for second generation reforms. If they (Assam State Electricity Board) cannot bring in professionalism, we might have to go the way Kolkata or Mumbai had gone,” said Bordoloi. Power distribution is in the hands of private players in both Kolkata and Mumbai.
However, he did not wish to divulge much into the privatisation matter, fearing opposition from certain sections in the society. “Let time come, then I will tell. If I speak now, there is a section in the society, who will be up in arms against me,” he added.
Bordoloi castigated the Assam Power Distribution Company Ltd (APDCL) for its inefficiency and mounting losses. APDCL was the 3rd most loss making state public sector undertaking in the 2010-11 fiscal.
The minister said that though he had given ASEB the free hand to run day to day affairs, the board was lacking professionalism. In 2004, as part of the reforms, ASEB was unbundled into five government companies - three distribution companies, one power generation company and one transmission company. Later, the three distribution companies were merged into one and was renamed as APDCL.
Since Assam undertook power sector reforms, the state became one of the front ranking states in the country as far as receiving loans from Asian Development Bank (ADB) was concerned. The second generation of power sector reforms and the thought to privatise power distribution is also seen as a quid-pro-quo for the generous assistance from ADB.
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Bordoloi said that since first generation reforms were undertaken, the transmission and distribution losses of ASEB came down from 50 per cent to 28 per cent.
The Assam government in 2007 had drafted a new hydro power policy to facilitate the entry of private sector in developing power projects up to 25 MW.