Orissa will have different tariff rates for different electrical zones within the state under the proposed privatised power distribution regime.
The state is divided into four electrical zones on geographical lines north, south, west and central. The privatisation of power distribution in these zones is likely to be finalised by the end of the current year.
Once the zones are handed over to private management, they will be allowed to work out their own tariff structures, based on the cost of supply of power in their respective areas, said a senior Grid Corporation of Orissa (Gridco) official. Obviously, this will lead to competitive pricing of electricity in various parts of the state.
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With the source and cost of purchase of power for distribution going to be the same for all the zones, the determination of tariff rate or, for that matter, the cost of supply of energy in respective areas will mainly depend on the transmission losses prevailing there, said the official.
As transmission losses increase with distance, the proximity of electrical zones to the point of drawal of power will play a key role in working out the tariff rate there. With most of the power stations in the state located in the western part of the state, the tariff is likely to be cheapest in the western zone, consisting of the districts of Sambalpur, Bolangir, Kalahandi, Sundergarh and Boudh.
Similarly, the energy charges are likely to be costlier in the southern, central and northern zones in that order because of their increasing distance from the source of drawal of power. At present, the average transmission loss and average tariff in the state works out to 24 per cent and Rs 2.30 per unit respectively.
Meanwhile, the Gridco board has decided to float four joint ventures with private partners to take up distribution in the four zones. The boards decision follows its bitter experience with Bombay Suburban Electricity Supply Corporation (BSES) which ultimately led to the scrapping of the distribution management contract for the central zone.
While the private partner will be allowed to hold a controlling stake of 51 per cent in each of the joint ventures, the remaining 49 per cent will be held by Gridco. The process of choosing the private partners for the joint ventures is slated to begin in December this year.
The privatisation of the distribution network assumes particular urgency due to the insistence of the World Bank, the main sponsor of power reforms process in Orissa, that the process should be completed by 2000.