The Tamil Nadu Transmission Corporation (Tantransco) is likely to commence operations by June this year. The company would have a capital base of Rs 20,000 crore and would be developed through joint venture partners, said electricity minister Arcot N Veerawamy.
The state government is planning to register Tantransco in a couple of months.
Under the Electricity Act, state electricity boards cannot perform all the functions of generation, transmission and distribution because the agency engaged in transmission is barred from trading in electricity.
The Tamil Nadu Electricity Board is currently into power generation, transmission, distribution and trading. Once the new company is formed, the transmission activity of TNEB would be shifted to Tantransco.
The substations of TNEB would contribute Rs 8,000 crore while the remaining amount would come from joint venture partners. The minister said a few domestic firms, including the Power Trading Corporation, and international players have shown interest to invest in the new company.
The state government in October had said it would re-organise the board into a holding company and two subsidiary companies. An order issued then said the holding company would be called TNEB Limited and the subsidiaries Tantransco and the Tamil Nadu Generation and Distribution Corporation Limited (Tangedco). All the companies would be fully owned by the government.