The Maharashtra government is considering extending private power distribution to Dahanu in the north of Mumbai from the current zone of just Mumbai and its suburbs.
Infrastructure Finance and Leasing Services has been roped in as consultants.
It is expected to give broad guidelines for the proposed joint venture company for the project in which the state government's equity participation will be 30 per cent.
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The move broadens the scope of the government's earlier proposal to set up a joint venture company to distribute power in the Navi Mumbai and Raigad areas. Now the proposal is being extended to cover Dahanu as well.
The structure of power distribution will be similar in all three areas. A joint venture company with state government participation will be set up for Navi Mumbai, Raigad and Dahanu.
The latest move is likely to benefit the Mumbai-based power major BSES, which already operates a 500 mw plant at Dahanu.
Sources close to the state government said both BSES and Tata Electric Companies had been sounded out and they are interested in the proposed joint venture.
State authorities have commenced data collection on power requirement in the region, proposed investment and the prospective customers in Dahanu.
Dahanu, Navi Mumbai and Raigad are now being fed by the Maharashtra State Electricity Board (MSEB). Strapped for funds and unable to meet growing demand in the region, the state government is eyeing private power participation.
Sources said it would be some time before the state government invites tenders from private companies to participate in setting up the joint venture company to distribute power.
MSEB has been attempting to improve power distribution in the state for quite some now.
Private participation is just one of them.