HPSEB is now history

After a delay of nearly seven years,the government of the hill state has ordered unbundling of the Himachal Pradesh State Electricity Board...

Written by Ashwani Sharma | Shimla | Published: May 26, 2010 3:43:43 am

Himachal unbundles its power board but keeps it a single govt entity

After a delay of nearly seven years,the government of the hill state has ordered unbundling of the Himachal Pradesh State Electricity Board (HPSEB),ahead of the June 15,2010,deadline fixed by the Centre to effectively implement reforms in the power sector.

The HPSEB will,however,remain a single entity as entirely a state government corporation. There will not be any further restructuring and privatisation,as most state governments have done to trifurcate the boards.

The government has also agreed to the terms put forth by the HPSEB Employees Joint Front,which had vehemently opposed the privatisation of the board. It signed an agreement with the front on Monday night to retain HPSEB as a government-owned corporation. The Himachal Pradesh Power Transmission Corporation has been declared a state transmission utility (STU) and will engage its entire staff from the HPSEB Limited.

The Cabinet will meet here on Wednesday to put a seal on the decision.

Principal Secretary (Power) Deepak Sanan,who was on an official tour to New Delhi,confirmed that the HPSEB had been unbundled. “The model chosen by Himachal Pradesh is slightly different from that adopted in Punjab or other states. I think Himachal will do well after opting for this model,” he said.

Sources said representatives of the HPSEB Engineers and Employees’ Front had held a series of talks with Chief Secretary Asha Swaroop,HPSEB Chairman Subash Negi and Principal Secretary (Power) Deepak Sanan. Eventually,the issue also went to Chief Minister Prem Kumar Dhumal,who gave his nod to the model proposed by the official team.

Under the Electricity Act 2003,the state governments are required to scrap the state electricity boards and create separate identities for discharging the functions of power generation,distribution and transmission. Though the government had issued the notification last year,vesting the assets and liabilities of the HPSEB to the state government,it could not take further steps.

Sunil Grover,convener of the joint front,said: “On May 24,the state government took a historical decision by agreeing to the draft transfer scheme to declare HPSEB a government-owned corporation. By not going for trifurcation of the HPSEB into private companies,the government has tried to protect the employees’ interests. I think many states will take a lesson from Himachal.”

The main features of the proposed Himachal Pradesh Power Sector Reforms Transfer Scheme 2010 are as follows.

All assets,properties,interest in properties,rights and liabilities of the board,including all obligations and contingencies,will be transferred to the ‘HPSEB Limited’,except inter-state transmission lines or transmission lines that are not essential part of the distribution system.

The new corporation will undertake the functions of generation,distribution and trading of electricity. And while acting as distribution licensee,it shall be entitled to lay and operate electric line,sub-station and electrical plant.

The statutory functions of the State Load Despatch Centre (SLDC) shall be undertaken by the HPSEB Limited under the Directorate of Energy. However,the existing SLDC will continue to work as SLDC as well as Area Load Despatch Centre,which also happens to be a mandatory clause of the Electricity Act 2003. But the statutory function of the STU will be performed by the Himachal Pradesh Power Transmission Corporation.

All personnel of the board shall stand transferred to HPSEB Limited and could be taken in for deployment in the transmission corporation and also Himachal Pradesh Power Corporation Limited — both government-owned PSUs.

History of HPSEB
The board was formed in 1971 in Himachal,which became a fully electrified state in the early eighties despite tough terrains and varied climatic factors — like tribal belts remaining under snow for seven to eight months in a year. However,the real boom in the power generation (state has 21,000 MW power potential) came only after privatisation of the hydro-power sector in 1990-91 by the then chief minister Shanta Kumar.

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