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Goa may become first state with private power transmission and distribution

Sandesh Prabhudesai in Panaji

Goa may become the first state in India with a private power transmission and distribution network.

Chief Minister Pratapsing Rane plans to sign a fresh contract with the International Finance Corporation to prepare an information memorandum, based on which international bids will be invited to set up the network.

In this regard, the Congress state government would also appoint a British consultant on the state regulatory authority, besides appointing consultants of international repute for legal, technical and commercial expertise.

"The information memorandum, to be prepared by the consultants to set performance standards, would be the actual X-ray of a company that would be set up," says Development Commissioner Rakesh Mehta. The firm will distribute all the power generated by private companies in the state.

The IFC report on transmission and distribution calls for stringent measures to normalise Goa's power situation. But the immediate result will be a sharp rise in power and water tariff. The plan is to impose an energy tax on consumers, exempting public lighting, agriculture and domestic consumers using up to 300 units per month. That would be considered a subsidy.

Existing blanket subsidies to all domestic consumers, for water supply, irrigation, and to the cement industry would be scrapped.

Subsidies for new industries coming to the tourist state have already been discontinued since April. This reduces the state's annual subsidy burden from Rs 500 million to Rs 100 million.

The proposal hopes to reduce annual breakdown frequency to 25 hours from the existing rate of 111 hours. Similarly, the voltage fluctuations are also to be brought down. Stress is to be put on effective consumer service, quality management and massive automation.

The existing electricity department would be reduced to collecting tax, purchasing power from National Thermal Power Corporation, and other administrative functions, says Mehta. The IFC thus proposes to reduce the employee-consumer ratio from 15 per thousand to 8 per thousand.

The IFC figures take into consideration Goa's annual GDP growth rate of 12 per cent. The state is expected to use 379 MW of power by the end of the century and 580 MW after five years. Currently, Goa gets only 200 MW, against its actual requirement of 303 MW.

Operation and maintenance cost will be stable at Rs 520 million per annum, but the transmission and distribution cost would rise from Rs 250 million in 1999 to between Rs 440 million and Rs 510 million in the next five years. It is expected to increase to Rs 1.25 billion by 2014 and to Rs 6.47 billion by 2029.

The government plans to supply private power by next April.

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