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Cover Story | September 2011

T&D: Need for PPP in distribution

Recently, BK Chaturvedi, Member, Planning Commission, said that major investments were required in the transmission and distribution segments in the days to come. In this context the planning commission has also formed a committee to report on the need for public private partnership (PPP) in power distribution. The decision in favour of the PPP mode follows the shortcomings of the franchisee model. He also told banks to be more prudent while lending to financially weak power distribution utilities (discoms), controlled by state governments.

To strengthen the transmission and distribution (T&D) infrastructure, the Andhra Pradesh government has proposed that it will invest Rs 14,000 crore in the next four years. Accordingly, it was decided to conduct a session to chalk out a strategy for the effective implementation of a five-point programme to improve generation to bridge the gap between demand and supply, strengthen the T&D network, reduce T&D losses, promote energy savings and re-focus on consumer initiatives.

In the next few pages, we have a report by IIFL's Institutional Equities which says that the
aggregate net worth of state electricity boards has been wiped out. So read on...
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