Mumbai, March 14 (IANS) As Chief Minister Devendra Fadnavis recently stated in the Assembly that state power distribution company (discom) will be the first to be listed on stock exchanges, Maharashtra State Electricity Distribution Company (MahaVitaran) CMD Lokesh Chandra said they are vigorously implementing capex for turnaround and cut tariffs charged to various consumers.
In an exclusive interview with IANS, MahaVitaran Chairman and Managing Director (CMD) Lokesh Chandra explained the discom’s strategy.
IANS: When will the listing happen? What is the plan for making MahaVitaran financially sound and profitable?
Lokesh Chandra: MahaVitaran’s listing will take place in the next two years, before March 2027. To make the MahaVitaran financially sound we have worked on the Resources Adequacy Plan scientifically, meticulously and to ensure cost optimization. Maharashtra is the 1st State which has not only finalised its Energy Transition Plan along with Resource Adequacy Plan but also has started implementation of the same. We have finalised power purchase agreements for 45,000 MW capacity in the last two years. In the next five years our Renewable Energy share will increase from present 13 per cent to 52 per cent. Since Independence till date we will have installed capacity of 36 GW and by 2030, this will become 81,000 MW. With the cost optimization, we will be saving Rs 1,13,000 crore in the next five years. Hence, our power procurement cost will come down.
In the recent tariff petition filed before the Maharashtra Electricity Regulatory Commission (MERC) for the control period for 2025-2030. We have proposed a reduction in the power tariff for Industrial & Residential Sectors. We have also proposed a 10 per cent rebate during solar hours to domestic consumers, Cross subsidy burden on the industries for Agriculture has been removed completely. Time of Day tariff has been introduced during solar hours and we will be giving a rebate of Rs 2.40 during solar hours. These measures and creation of a separate company for agriculture will definitely help us in improving the financial parameters of MahaVitaran. We will very soon become a profit making entity and will be going to list MahaVitaran in the next two years.
IANS: What is your capex to strengthen the distribution network?
Lokesh Chandra: While working the Resource Adequacy Plan we have also looked into the investment requirement in the transmission sector as well as the distribution sector. It is estimated that in the next five years the total investment in the power sector for Maharashtra will be Rs 3,30,000 crore out of which Rs 70,000 crore will be in the transmission sector and Rs 65,000 crore will be in the distribution sector. Out of this 70 per cent investment will come from the private sector and approximately Rs 2.5 lakh crore investment will be in Maharashtra. This will create 7 lakh jobs. We have already finalized the schemes for system strengthening and modernisation and at present we have started work on Rs 20,000 crore schemes and remaining Rs 45,000 crore are in pipeline for implementation. Once all these works are done, we are sure we will be able to supply adequate, reliable and quality to our consumers which will be from sustainable sources at affordable rates.
IANS: What is the present financial condition of MahaVitaran, especially, when rising arrears from agricultural consumers is a matter of concern?
Lokesh Chandra: By 2030, the state’s energy demand will grow from 1,85,000 million units to 2,80,000 million units and peak demand will grow from 29 GW to 45 GW. Our energy consumption is going to be more than Spain, Italy, Germany and Australia. Our annual revenue is more than Rs 1,22,000 crore and we cater to more than three crore consumers. Maharashtra has the highest agricultural demand of 16,000 MW. Agricultural arrears always pose a challenge on our financial parameters, as today we have more than Rs 75,000 crore of agriculture arrears, our liability is around Rs 90,000 crore. In order to tackle the agriculture arrears issue and to provide reliable and adequate power to the farmers during the day time, we have implemented the world’s largest distributed renewable energy program for solarisation of agriculture Feeders.
We are the first state in India who will shift 100 per cent agriculture Load (16,000 MW) on solar. We are implementing Mukhyamantri Saur Krushi Vahini Yojana 2.0 Scheme to provide day time power supply to the farmers. Maharashtra is also the 1st State to create a Separate Agriculture Company for supplying power to the farmers. This will ensure that agriculture arrears in future will not impact our financial parameters. The government is also working to help out by taking over losses. We have requested the government to take our losses which are primarily due to agriculture arrears. We are hopeful that we will get financial assistance for the losses and come over all these arrears and debt situations very soon.
We are also working on a number of schemes like Revamped Distribution Sector Scheme for strengthening and modernisation of the network for reduction in technical losses. Implementation of Smart Meter will also help us in reducing commercial losses. We have already completed system metering, i.e., feeder metering and distribution transformer metering which will help us in getting the energy audit data accurately to pinpoint commercial loss areas. Once these measures are done, we will be in sound financial condition.
IANS: Industry has been complaining about high tariffs, how will it be competitive with other states?
Lokesh Chandra: In the present tariff petition, we have removed the cross-subsidy burden of the industries. We have introduced a Time of Day (ToD) tariff incentive of Rs 2.40 per unit during solar hours. We have also reduced the overall average cost of power supply. All these measures will reduce industrial tariff in the next five-year and our tariff will be lower than other states.
(Sanjay Jog can be contacted at sanjay.j@ians.in)
–IANS
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