 "Tata Power seeks regulatory approval to strengthen distribution network in Mumbai")
Tata Power, which has a consumer base of half a million in Mumbai, will seek the Maharashtra Electricity Regulatory Commission (MERC)’s approval to strengthen its distribution network in the city. The plan, formulated after MERC’s directive last year at the time of renewal of distribution licence up to 2039, envisages an investment of Rs 1,000 crore and completion of network strengthening in three years.
Network expansion is necessary for Tata Power to increase its consumer base in Mumbai’s highly-competitive power distribution market. At present, the company has to use its rival Reliance Infrastructure’s network to service cross-over consumers. The network expansion will also help the firm step up distribution after the completion of replacement of 500 megawatt (Mw) of Trombay unit from gas-based to a thermal-based one. After putting in place its own network, Tata Power will not have to contribute towards regulatory assets and cross-subsidy surcharge. Mumbai’s current daily power requirement is estimated at 3,300 Mw.
Apart from Tata Power, which supplies power to 600,000 consumers, Reliance Infrastructure, Brihanmumbai Electric Supply & Transport (BEST) and Maharashtra State Electricity Distribution Company (MahaVitaran) are other players engaged in power distribution. Reliance Infra has a consumer base of 2.9 million especially in the western suburbs, BEST supplies power to 900,000 consumers in the south and the north central Mumbai, and MahaVitaran supplies to 200,000 in the north-eastern suburbs.
MERC official told Business Standard: “The hearing of Tata Power’s proposal is slated for Tuesday. The network rollout plan was to comply with MERC’s order with regard to the renewal of the company’s distribution licence last year up to 2039. After hearing Tata Power's proposal, MERC will provide its approval and thereafter the company will have to submit a detailed plan with regard to financing.”
Tata Power plans to expand its network within the city with a focus on 11 clusters comprising Mira Road, Dahisar, Kurla LBS, Saki, Mindspace in Malad, Trombay, Mankhurd-Chembur, Vrindavan in Anushakti Nagar, Arogyanidhi in Andheri West, Vasant Utsav in Kandivali East, and Malad BMC Lagoon. These areas are where the new development, especially redevelopment of old buildings and infrastructure development, is proposed.
Anil Sardana, managing director and CEO of Tata Power, had said earlier this month that the company would focus on strengthening its distribution network. The company’s distribution sales were reported at 5,969 million units in 2014-15 compared to 6,541 million units in 2013-14. The firm developed 704 km network in 2014-15, of which 286 km was high tension and 418 km low tension. Besides, 101 consumer substation and 10 distribution substations were also commissioned.
Network expansion is necessary for Tata Power to increase its consumer base in Mumbai’s highly-competitive power distribution market. At present, the company has to use its rival Reliance Infrastructure’s network to service cross-over consumers. The network expansion will also help the firm step up distribution after the completion of replacement of 500 megawatt (Mw) of Trombay unit from gas-based to a thermal-based one. After putting in place its own network, Tata Power will not have to contribute towards regulatory assets and cross-subsidy surcharge. Mumbai’s current daily power requirement is estimated at 3,300 Mw.
Apart from Tata Power, which supplies power to 600,000 consumers, Reliance Infrastructure, Brihanmumbai Electric Supply & Transport (BEST) and Maharashtra State Electricity Distribution Company (MahaVitaran) are other players engaged in power distribution. Reliance Infra has a consumer base of 2.9 million especially in the western suburbs, BEST supplies power to 900,000 consumers in the south and the north central Mumbai, and MahaVitaran supplies to 200,000 in the north-eastern suburbs.
MERC official told Business Standard: “The hearing of Tata Power’s proposal is slated for Tuesday. The network rollout plan was to comply with MERC’s order with regard to the renewal of the company’s distribution licence last year up to 2039. After hearing Tata Power's proposal, MERC will provide its approval and thereafter the company will have to submit a detailed plan with regard to financing.”
Tata Power plans to expand its network within the city with a focus on 11 clusters comprising Mira Road, Dahisar, Kurla LBS, Saki, Mindspace in Malad, Trombay, Mankhurd-Chembur, Vrindavan in Anushakti Nagar, Arogyanidhi in Andheri West, Vasant Utsav in Kandivali East, and Malad BMC Lagoon. These areas are where the new development, especially redevelopment of old buildings and infrastructure development, is proposed.
Anil Sardana, managing director and CEO of Tata Power, had said earlier this month that the company would focus on strengthening its distribution network. The company’s distribution sales were reported at 5,969 million units in 2014-15 compared to 6,541 million units in 2013-14. The firm developed 704 km network in 2014-15, of which 286 km was high tension and 418 km low tension. Besides, 101 consumer substation and 10 distribution substations were also commissioned.
Ashok Pendse, consumer representative at MERC, said Tata Power distribution's network expansion is to be seen in the context of competition and choice for consumers. "Whereever there is competition, power tariffs are under control. But at a later stage if tariff becomes virtually equal then the consumers will have to decide who will give better service and select that distributor,'' he said.
