Distribution franchise is a way to privatise power sector: AIPEF

PRIVATISATION IS being introduced in power sector through backdoor by giving distribution franchise of urban industrialised areas with low losses and maximum revenue earnings of a state to the private parties, alleged Padamjit Singh, Chairman All India Power Engineers Federation (AIPEF).Daljit Singh, General Secretary, Haryana Power Engineers Association said that Haryana government was trying to give Gurgaon and Panipat on distribution franchise whereas both the areas had low losses and high revenue. The collection efficiency of Gurgaon was over 100 percent. He said that the association had a meeting with management of Dakshin Haryana Discoms where the association questioned the move to give Gurgaon to a franchise. It was assured by management that before taking any decision the Association would be consulted. The financial condition of the two Haryana Discoms has deteriorated since unbundling. While the accumulated loss of Dakshin Haryana Discoms was Rs 1900 Cr, the outstanding loan has increased to Rs 3800 Cr. In case of Northern Haryana Discom the losses had accumulated to Rs 2400 CR and loan to Rs 9000 Cr.Padamjit cited the example of Aurangabad in Maharashtra where, franchise had been given to private party even though the losses had been reduced from 30.5% in 2006-07 to 19.5% (2010-11.The revenue had increased from Rs 377 crore in 2006-07 to Rs. 491 crore in 2009-10 with collection efficiency of 100.61%.Padamjit added that Aurangabad division was given the India Power Award in 2010 for reduction in AT & C losses and reduction in transformer failure rate. Aurangabad urban division -II was adjudged the best performing division in Maharashtra by the Discoms management for 2009-10. The case of awarding Aurangabad to franchise is thus a proven case of picking out the best performing areas with low losses and high revenue for giving on franchise to private party. The same is going to be repeated in Haryana. Shalien der Dubey, Secretary General, AIPEF said that in case of Agra Franchise, Discom (Paschimanchal) had already suffered a loss of over Rs 100 crore on account of power purchase at higher cost to meet Agra Franchise requirement with power being supplied at much lower rate. Agra example proved that by giving franchise the private franchise party will gain huge profit while the state Discoms would be loser.Further despite the proven case of Agra, UP govt. was trying to give Kanpur on private franchise even through the AT&C losses had been reduced and revenue had increased. There was a master plan to introduce to franchise model in other major UP towns like Varanasi, Allahabad, Moradabad, Meerut, Aligarh, Gorakhpur, Bareilly etc.The engineers and workers in power sector throughout the country are forming a joint front to oppose distribution franchising and an action plan has been drawn up starting with regional conventions.