Power board’s unbundling begins
Rakesh Lohumi
Tribune News Service

Shimla, June 15
After dithering on the issue of unbundling of the state electricity board for about four years, the government has initiated the process for its restructuring.

As a first step towards compliance with the Electricity Act, 2003, a notification is being issued for vesting the assets of the state power utility in the government. The board will cease to be an entity after the notification, likely to be issued late this evening or tomorrow under Section 131(1) of the Act for the purpose of vesting of functions, priorities, interest, rights, obligations and liabilities of the board in the state government for re-vesting in a corporate entity or entities. Till that time, it will be managed on the behalf of the government by a committee headed by special officer (chairman of the board) and comprising members of the existing board.

Uncertainty will continue as it will take some more time for the government to finalise the models for restructuring. It had agreed to consider the model submitted by the joint front of employees and engineers under which reorganisation was to be carried out without unbundling by creating business units for generation, transmission and distribution. It wanted board to be reorganised into one company which should handle all three activities.

However, the Government of India had, in its advice to the state, made it clear that functions of distribution and transmission had to be completely segregated under the Electricity Act, 2003. It had also stated that the consent given for continuation of board as STU (state transmission utility) and a licensee under the Act would expire on June 15 and if necessary steps were not taken to comply with its provisions, the board would cease to be a league entity thereafter.

The proposal, along with the advice received from the Government of India, will be submitted to the Advocate General and Law Secretary for their opinion. In case the proposal is not at variance with the legal advice, it will be sent to the Centre for its advice. The matter will be discussed again with the joint front after receiving the advice. Further, the transfer scheme for re-vesting under Section 131(2) will be finalised within a period of six months.