MSEB urged to consider recast proposal

MUMBAI, FEB 7: The Maharashtra State Electricity Board MSEB has been urged to consider a list of recommendations outlined by the Centre...

MUMBAI, FEB 7: The Maharashtra State Electricity Board MSEB has been urged to consider a list of recommendations outlined by the Centre on a recast proposal. The suggestions were forwarded to the board by the state department of energy.

The plan explains the mode of implementing these guidelines which include dismantling of the board and setting up different companies for generation, transmission and distribution.

MSEB is still to make up its mind on the issue. This is not the first time that the board has been urged to go in for reforms. It may be recalled that a similar suggestion was made by the Rajadhyaksha committee in its report of 1996.

Maharashtra had announced that it would be the first state to set up a electricity regulatory commission but has not got going on the plan yet. The World Bank terminated a loan on the grounds of non-implementation of reforms. The state appointed a select committee six months ago to recomend experts for the commission, but no follow-up has yetcome.

Acknowledging the progress made by Orissa, Haryana and Andhra Pradesh, the present proposal has sought immediate action on change. quot;The need for reforms and restructuring can no longer be postponed, lest the electricity sector in the state come to a grinding halt affecting economic and industrial growth and further causing extreme hardship to the common man,quot; it has stated.

According to the plan, the regulatory functions of the board and state government should be transferred to an independent regulatory authority. The board should be split into separate corporates and private players can be invited later to participate in these companies.

Corporatisation of the board has been recommended as it will impart greater confidence to banks/financial institutions for investment. However, the proposal reiterates that privatisation is not a must for the reforms process. quot;While privatisation or private sector participation is one of the important means by which reforms and restructuring in the electricitysector can be achieved, it does not mean that in the absence of such participation, the sector cannot improve,quot; says the proposal.

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It has suggested phased restructuring which will help employees adapt to the changes. The report has emphasised that while executing the reforms, the interest of employees should be guarded. quot;There need not be retrenchment of the employees for the purpose of restructuring of SEB. The entire workforce can be transferred to the different companies,quot; it says.

As for the role of the state government post-restructuring, the report says that it should quot;restrict itself to giving policy directives.quot;