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Reliance Energy actively participated in the pioneering initiative
of the Government of Orissa for privatizing its distribution systems. The
distribution and retail supply of electricity was assumed by Grid
Corporation of Orissa Limited (Gridco) as a successor to the Orissa State
Electricity Board. Gridco carried on distribution and retail supply of
electricity in the State of Orissa through four separate companies,
namely, Western Electricity Supply Company of Orissa Limited (WESCO),
North Eastern Electricity Supply Company of Orissa Limited (NESCO),
Southern Electricity Supply Company of Orissa Limited (SOUTHCO) and
Central Electricity Supply Company of Orissa Limited (CESCO). Gridco
initiated an international competitive bidding process for selecting
private sector investors to acquire equity stake in these distribution
companies. Reliance Energy was selected to invest in 3 of these distribution
companies of Gridco, namely, NESCO, WESCO and SOUTHCO. The three
distribution companies were acquired for a consideration of Rs. 117 crore.
NESCO, headquartered at Balasore, caters to a consumer base of 0.40
million covering an estimated population of 9.18 million on a licensed
area of 28,000 sq.kms. with an estimated energy input of 2,500 Mu's.
WESCO , headquartered at Burla, caters to a consumer base of 0.40
million covering an estimated population of 9.40 million on a licensed
area of 48,000 sq.kms. with an estimated energy input of 3,700 Mu's.
SOUTHCO, headquartered at Behrampur, caters to a consumer base of
0.40 million covering an estimated population of 8.71 million in a
licensed area of 47,000 sq.kms. with an estimated energy input of 1,600
Mus.
The Discoms have right from the beginning faced a number of operational,
financial and administrative difficulties, which have been widely
acknowledged and accepted by all experts. The Government of Orissa
constituted a Committee of independent experts to examine the various
issues and to look into the problems confronting these companies. The
Committee has made several recommendations and these recommendations are
likely to have a positive impact of the financial results of these
companies. These companies continue to pursue these matters including the
need to restructure these companies, with the authorities concerned, so as
to enable these companies to strengthen their distribution networks and
improve their operational and financial performance. |
