Powerless
Though the Electricity Act, 2003, does not allow state electricity boards to simultaneously engage in generation, transmission and distribution of power, two successive TN governments have been extending the deadline to restructure TNEB, which wears all these hats.
Despite an imminent crisis that shows no signs of blowing over, TN is yet to initiate any serious power sector reforms. Meanwhile, neighbours such as Andhra Pradesh (AP) have made remarkable strides in distribution. In fact, AP has been ranked the top power utility by major rating agencies for the past three years, which was achieved by drastically reducing its aggregate technical and commercial losses from 37 per cent in 1999-2000 to 15.8 per cent in 2005-06, and by achieving 100 per cent revenue collection, a rare feat.
Presently, TN has 23 projects with a total capacity of 7808 MW in the pipeline, which is almost equal to the state’s annual power demand. For the interim, “We have floated tenders for buying power,” says a government official. “There are a few pockets with surplus power and we plan to tap them fully.”
TN’s Minister for Electricity, Arcot N. Veerasamy, has stated that he expects no power cut in the state this summer. While the government can purchase power from the North-East, Punjab and Haryana, buying power from private plants through open bidding can jack up costs to Rs 5 per unit. Besides, ad hoc measures can hardly meet a growing demand.
“Yes, we are concerned. In the manufacturing business, uninterrupted power and water supplies play a critical role and any such shortages can definitely adversely impact business operations and have effect on future planning and investments,” says Vice President of manufacturing at Ford India, Tom Chackalackal. After 10 years of plentiful power, Ford recently announced a $ 500 million (Rs 2,000 crore) investment in Chennai, the largest by the company in India so far. But if TN wants to remain a favoured investment destination, it must first make sure the lights don’t go out.
This email address is being protected from spam bots, you need Javascript enabled to view it
(Businessworld Issue 05 - 11 February 2007
<< Start < Prev 1 2 3 4 Next > End >>
|
Sensex rises 61 points in opening trade 
