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Power distribution in Delhi privatised

In a major step towards bringing about power reforms in the Capital, the Delhi government on Friday signed agreements with two Mumbai-based private companies that would take over the power distribution in Delhi.

The 'share acquisition agreements' were signed by power secretary Ramesh Chandra on behalf of the Delhi government, S S Dua, chairman of BSES Ltd, and Adi Engineer, managing director of Tata Power in New Delhi in the presence of Chief Minister Sheila Dikshit, power minister Ajay Maken and other Delhi ministers.

As per the agreement which will come into effect from July 1, distribution will be managed by three companies to be set up - Central and East Delhi Electricity Supply Company worth Rs 2.90 billion, West and South Delhi Electricity Supply Company worth Rs 11.50 billion, and North and North West Delhi Electricity Supply Company worth Rs 9.20 billion.

While BSES Ltd will take control of CEDESC and WSDESC, Tata Power will take charge of NNWDESC, Dikshit said after the agreements were signed.

The Delhi government will retain 49 per cent equity in the distribution companies, she said.

The agreements were reached after the government relaxed some of the stipulations, agreeing to the two companies' suggestions.

After renegotiations, the government reduced the target fixed for reduction of transmission losses to around 17 per cent over a period of five years as against its earlier condition of 20 per cent.

The two companies had earlier said the reduction could be only 13 per cent.

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