MUMBAI: Maharashtra has floated one holding company and three subsidiaries to take over electricity generation and distribution from the Maharashtra State Electricity Board (MSEB) and to corporatise the State power sector to be able to enter the capital market.

But all the four companies would be in the State public sector and would not be privatised, asserted Energy Minister and ex-officio chairman of the holding company, Dilip Walse-Patil, at a press conference here on Tuesday. "But they would act as any entity incorporated under the Indian Companies Act, including raising capital from the private sources."

Rs. 24,000 cr. assets

The MSEB had to be `unbundled' as per provisions of the Union Government's Electricity Act, 2003.

The State Government has taken over MSEB assets at its book value — now estimated to be Rs. 24,000 crores. Mr. Patil said that with the help of consultants there would be business valuation of the assets for their division among the four companies.

The process would take some time but the transfer of assets would take place with retrospective effect, from June 5, 2005. But care would be taken to ensure that this did not result in any increase in the tariff.

While the Energy Minister would head the holding company to be called MSEB Holding Company Ltd, the Minister of State would be its ex-officio vice-chairman.

Besides them, the board of directors would have one managing director and a finance director — both whole-time directors.

The Energy and Planning Secretaries of the State and managing directors of the three subsidiaries would be ex-officio members of the holding company's board of directors.

Besides, it would have one energy expert director and two non-government directors.

Part-time chairmen appointed by the State Government will head the subsidiaries — the Maharashtra State Electricity Generation Company Ltd and the Maharashtra State Transmission Company Ltd.

The managing director and directors of finance, operation and human resources would be full-time directors. The holding company would appoint four directors on their boards, who would be experts in the areas of energy, industry, finance and law.

The third subsidiary, the Maharashtra State Distribution Company Ltd, will have two more non-government directors besides these.

Though these companies would take over the power generation, transmission and distribution functions of the MSEB, the latter would not be wound up "for technical reasons."

The MSEB was formed 45 years ago, on June 20, 1960, within a few weeks of the formation of the State of Maharashtra. Its initial capacity was to generate a mere 760 MW to supply to 1.07-lakh consumers in 853 villages and towns and earning Rs. 3.23 crores a year.

Now the board hands over to the new companies the power generation capacity of 14,363 MW, to serve 1.4-crore consumers spread over 40,687 villages and towns.

The annual revenue is over Rs. 15,000 crores. The MSEB completed electrification of the entire State in 1989.

But the new companies have stupendous tasks of making good the power deficit of 3200 MW that Maharashtra faces, reducing transmission and distribution losses to a reasonable 15 per cent from 35 per cent and recovering outstanding bills of Rs. 8,500 crores.

Printer friendly page  
Send this article to Friends by E-Mail

Other States

News: Front Page | National | Tamil Nadu | Andhra Pradesh | Karnataka | Kerala | New Delhi | Other States | International | Opinion | Business | Sport | Miscellaneous | Engagements |
Advts: Classifieds | Employment | Updates: Breaking News |