Web Exclusive | January 2013
'Regulatory commissions can take up discoms' debt rejig'
Financial restructuring of power distribution companies in the country should be done through regulatory commissions and not directly by State governments, Tata Power has suggested. The company's suggestion comes amid rising concerns about debt woes of power distribution companies.
The view point of Tata Power, India's largest private power producer, has come against the backdrop of Centre's financial restructuring plan for discoms, under which half of the debt burden is to be shared by respective State governments.
Tata Power Managing Director Anil Sardana told a leading news agency that regulatory commissions should do the financial rejig of the discoms in the country. That means money should be made available, as a financial support, to regulators who should then set targets and against the achievement of those targets, allow the restructuring to happen, Sardana said.
Each state has its own State Electricity Regulatory Commission (SERC). Power distribution companies' (discoms) debt burden, which stood at a staggering Rs 2.46 lakh crore at end of March 2012, is a major concern for the sector that is already grappling with severe fuel scarcity.