CERC to private power transmission in west

Even as the Central Electricity Regulatory Commission (CERC) has turned down Reliance Energy Transmission Ltd's application for a transmission licence in the western region, it has set the stage for the entry of private firms into the sector.

In its order dated July 29, the CERC said two packages of high-voltage lines would be handled by PowerGrid Corporation of India Ltd (PGCIL), either alone or in partnership with private sector companies.

The other two sets of lines, it said, would be developed with 100 per cent equity contribution from private companies. If selected by PGCIL, private sector companies will have to approach the CERC for a transmission licence.

The move will also encourage private investment in the sector. Investments in the sector will have to go up to Rs 20,000 crore by 2012, the CERC said in the order.

The 765 Kv and 400 Kv quad lines were critical and any delay in their completion could adversely affect delivery of power in the region, the order said, adding that these lines would be implemented either exclusively by PowerGrid, or through a joint venture.

PowerGrid has already invited bids from private parties to form joint ventures with it in all four sets of lines.

Companies including Reliance Energy, Tata Power, Crompton Greaves, Kalpataru, Gammon and Areva have expressed interest.

The partners will own between 51 per cent and 74 per cent in the JVs.The remaining lines could be implemented by private firms with past experience in the field, the CERC said.

"Transmission projects can be developed with 100 per cent equity participation from the private sector," in the remaining two sets of transmission lines, the order said.

PowerGrid has been asked to modify its bid documents for these transmission lines.PGCIL had issued a revised request for the qualification document, and only one company, of the 21 which expressed interest, had asked for a clarification, said PGCIL executives.

September 15 is the last date for short-listing qualified parties and issuing requests for proposal documents.

The CERC has also clarified that any case arising in the future will be governed by regulations to be framed by it on terms and conditions for construction of inter-state transmission and guidelines to be issued by the Centre.