Tata Power eyes distribution franchisee for 80 towns in J&K
Soon after Tata Power Ltd tied up with Ajmer Vidyut Vitran Nigam Ltd for electricity distribution in Ajmer for 20 years, the company has set its eyes on a contract for a similar service in Jammu and Kashmir and has already shortlisted 80 towns in the state. Tata Power-Delhi Distribution Ltd (TPDDL), an arm of Tata Power, would lend its technical assistance to its parent company.
"TPDDL looks after Delhi distribution and our parent, which is Tata Power, has bid for the franchise in Ajmer and has been selected based on the bid. It's a 20-year arrangement; we will do the operation and maintenance as well as the billing and collection," Praveer Sinha, chief executive and managing director of TPDDL, told
Business Standard in an interview. Sinha said the parent company's faith in TPDDL to execute the franchise model comes from the fact that “we have the domain knowledge and the experience in Delhi and Mumbai”.
When asked to elaborate on the selection of 80 sites across Jammu and Kashmir for execution of the franchise model for electricity distribution, Sinha only divulged that the effort would be to energise the Ladakh district of the state.
Jammu and Kashmir signed a memorandum of understanding for power distribution reforms called Ujwal Discom Assurance Yojana (UDAY) in March last year. The tripartite agreement of central ministry of power, state government, and the discoms aims at financial and operational reforms in state-owned discoms.
An overall net benefit of approximately R9800 crore would accrue to the state by opting to participate in UDAY, by way of savings in interest cost, reduction in AT&C (aggregate technical and commercial) and transmission losses, interventions in energy efficiency, coal reforms, etc, during the period of turnaround, said the officials. The reduction in AT&C losses and transmission losses to 15 and 4 per cent, respectively, is likely to bring additional revenue of around R7,150 crore during the period of turnaround. Officials said awarding distribution franchisee to Tata Power is part of the reform process.
TPDDL also provides consultancy services and is looking at increasing its footprint in the states of Uttarakhand, Haryana, Goa, and Karnataka, and exploring similar opportunities overseas, mainly in Southeast Asia and Africa.
In order to expand its business presence in the power distribution segment, TPDDL is pinning hopes on regulatory reforms through proposed amendments in the Electricity Act.
"For the proposal of segregating carriage and content, several talks have been going on. The Forum of Regulators has come out with an action plan dividing the states into four parts or four blocks and would go for separation of carriage and content in Phase-I (three to five years) and likewise. As the government has laid emphasis on IT implementation, it should be executed as soon as the discoms are ready for separation of carriage and content," Sinha said.
TPDDL LOOKS AFTER DELHI DISTRIBUTION AND OUR PARENT, WHICH IS TATA POWER, HAS BID FOR THE FRANCHISE IN AJMER AND HAS BEEN SELECTED BASED ON THE BID. IT’s A 20-YEAR ARRANGEMENT; WE WILL DO THE OPERATION AND MAINTENANCE AS WELL AS THE BILLING AND COLLECTION
PRAVEER SINHA, CEO & MD of TPDDL