Power board ceases to exist, restructuring begins
Tribune News Service

Shimla, June 16
The state electricity board ceased existing today with the vesting of its functions, properties, interests, rights, obligations and liabilities in the state government to set in motion the process of its restructuring.

A notification has been issued under Section 131(1) of the Electricity Act, 2003, after prolonged discussions with engineers and employees of the board who had been opposing the unbundling. The employees and the state government had no option but to take steps to comply with the Act as the Union Ministry of Power had made it clear that no further extension would be granted beyond June 15, 2009, to allow the board to continue in the unbundled form.

The government has also constituted a managing committee headed by a special officer (chairman of the board) and comprising five members (the existing members) to administer affairs till the functions, properties and assets are re-vested in a government company or companies to be incorporated as part of the restructuring exercise.

The scheme to re-vest into company or companies will be notified within six months. They will be government companies and as such there is no element of privatisation of the board.

An official spokesman said it would be ensured that the service conditions of the employees were protected and pension and other benefits of existing and retired employees would be completely secured. While preparing the scheme to re-vest the property and rights into the new government entity or entities, the proposal of joint front of employees and engineers would be examined from legal point of view.

He said the objective behind reorganisation of board as envisaged in the Electricity Act, 2003, was to create a congenial environment of reforms in the power sector by bringing efficiency and growth in the sector where, apart from various electricity boards, Central and state public sector undertakings and private sector players were engaged in generation, transmission, distribution and trading. By reorganising the board into government companies, necessary institutional framework would be available to stimulate investment and growth in an equitable manner in the sector.