Power engineers want Torrent's Agra franchisee cancelled

Allege that the franchisee resulted in loss of over Rs 1,500-cr to UP Power Corporation in last five years

A day after Uttar Pradesh cabinet cancelled Torrent Power's agreement to distribute electricity in Kanpur, All India Power Engineers Federation (AIPEF) has demanded the company's agreement for Agra be scrapped as well.

AIPEF chairman Shailendra Dubey alleged the Agra franchisee held by Torrent Power had resulted in loss of over Rs 1,500 crore to UP Power Corporation Limited (UPPCL) in the last five years.

In a press communique today, he maintained the pact be rescinded considering the huge losses accruing to the state power utility.

He claimed UPPCL earned Rs 1.50 less from the Agra franchisee compared to Kanpur Electricity Supply Company (KESCO) in 2014-15 resulting in loss of Rs 325 crore.

 

Dubey said even the Comptroller and Auditor General (CAG) report had pegged the loss at Rs 5,341 crore due to the discrepancy in agreement with the franchisee.



He said during 2014-15, UPPCL supplied about 2,148 million units to Torrent at the rate of Rs 3.35 per unit, while KESCO supplied 2,699 million units to its power consumers and earned revenue of over Rs 1,657 crore with the average tariff standing at Rs 4.88 per unit.

This way, UPPCL posted loss of Rs 1.50 per unit in Agra compared to Kanpur, which adds up to Rs 325 crore for 2,148 units.

The agreement with Torrent Power Limited was signed by Kanpur Electricity Supply Company (KESCO) on May 18, 2009 during the previous Mayawati regime for the input based franchisee model.

While, the power distribution transfer could not happen in Kanpur due to the stiff resistance by the state power employees, Torrent Power took over the franchisee in Agra on April 1, 2010.

After a bidding process, Torrent was selected to distribute power in both Agra and Kanpur, which were taken up in first phase since the transmission and distribution losses were the highest in these places at 42 per cent and 47 per cent respectively.



The state cabinet meeting here chaired by chief minister Akhilesh Yadav here yesterday had given its nod to the proposal of scrapping the agreement in Kanpur.

Since, the financial basis of KESCO changed over the years, it was felt that pursuing the agreement would not be in the interests of the state energy department.

A meeting was held between the representatives of the both the companies on December 27, 2015, which had agreed upon mutually to cancel the agreement. The cabinet put its seal of approval to this proposal.