Power distribution in the State of Maharashtra may slip into hands of big private players as MSEB Holding Company is keen to appoint five players, one each for the geographic region. Having burnt their fingers in the franchise model, the MSEB bosses have opted to appoint a consultant to suggest the best possible model for dismantling the company. Bids were invited to Conduct Study and Advising on Organisational Restructuring of MSEB Holding Co. Ltd Group, a precursor to dismantling the existing structure where State run companies Generate power, transmit and also distribute it to consumers.

 

The end result may be State Government planning to seek way out of the power business, starting with ending current monopoly of MSEDCL in distribution business. An expert team submitted a report of Gujarat model of power distribution privitisation to of MSEB Holding Co. But still the company bosses wants an expert opinion before taking a final call on ending MSEDCL's monopoly in power distribution network, said the bid document. The Consultant is tasked with taking a look at model adopted by States of Madhya Pradesh, Karnatak, Rajasthan, Andhra Pradesh and others as to role of Holding Co. and its management of business of Generation, Transmission and Distribution of its subsidiaries.

 

As earlier attempts to rope in private players in franchisee did not evoke any response, MSEB Holding Company reworked their mathematics and to induce big industry it decided to widen consumer base and also geographical area. But Maharashtra State Electricity Workers Federation (MSEWF) said the move is fraught with big risk and earlier franchisee model nearly caused havoc in the distribution sector leaving citizens to face the trouble. Ending monopoly of MSEDCL in the power distribution business is only going to backfire as private companies sole motive is profit and when same dwindles the network and people suffers, said Mohan Naidu, President, MSEWF. He also criticised the double standards of State Government that is criticising Central Government over ordinance that amended Indian Electricity Act but by eyeing Regional Franchisee Model they are keen to bend backward to follow Union Government. Earlier, MSEB was divided into four groups, one each for Generation, Transmission and Distribution and former was turned into holding company, in year 2005.

 

That time Government and policy makers, planners said the Corporatisation of MSEB it would cut down losses and improve power sector. However 15-years down the line, losses have only multiplied and tariff is reaching the sky leaving people in soup, he pointed out. So now another experiment is sought to be thrust down the throat of citizens who off course do not have any say in any of this policy making that is however going to impact them in a big way, Sharma alleged. The discussion in top echelons of MSEB Holding Company is to rope in big players in the industry, one each for the geographical region of Maharashtra, like Vidarbha, Marathwada, Western Maharashtra, North Maharashtra and Konkan. Five individual companies would take over power distribution thereby bringing curtains down on MSEDCL role. But last time when franchisee model failed, MSEDCL atleast was present in sizable number and could salvage the situation. However if MSEDCL is bundled out in totality and Regional companies to leave the field midway, what would happen to power distribution remains a big question, and fears of MSEWF is not unfounded.

 

The last date for submission of bids was July 5 and top officials of Energy Department are scrutinising the documents and waiting green signal from political bosses to carry out further exercise, said P V Naidu, an office bearer of MSEWF. Adoption of Region as base area is because it provides a broader area for a big player to operate with enough cushion due to trading in large volume of power. This in turn provides enough cushion for any big player in volatile power sector. Naidu said they are not opposed to entry of private players, but as they stated earlier also, MSEB should give priority to business houses that are already in power generation and aim must be to bring down tariff for the consumers. Till then the entire exercise would nothing but another hogwash as current model of MSEDCL is very good example how not to plan bifurcation, said Sharma further. Sharma however said Uttar Pradesh was the first to rollout Regional Companies model after Central Government brought in Ordinance in year 2019. The same idea was lifted by Madhya Pradesh but here to the Government is now in double mind as the aims stated in the draft document could not be achieved. Despite ample evidence that entry of private players in distribution is not very a good idea, Maharashtra Government is eagerly looking forward to increasing trouble for the people of State.