Chandigarh kicks off privatisation of power dept
Dushyant Singh Pundir
Tribune News Service
Chandigarh, November 22
The UT Administration has set the ball rolling for privatisation of the Electricity Department. After getting approval from Punjab Governor and UT Administrator Gulab Chand Kataria, the administration today issued a letter of lntent (LoI) to Kolkata-based Eminent Electricity Distribution Limited (EEDL), a subsidiary of the RP Sanjiv Goenka (RPSG) Group.
The LoI is a document signifying a preliminary commitment by one party to do business with another. It outlines the key terms of a prospective deal.
On November 7, the Punjab and Haryana High Court had paved the way for privatisation of the UT Electricity Department after dismissing the UT Powermen Union’s petition, which was filed on December 1, 2020.
As part of major structural reforms, the privatisation of power distribution utilities was envisaged under the Atmanirbhar Bharat Abhiyan launched by the Centre in May 2020.
Pursuant to this, the process was initiated in Chandigarh and the EEDL was selected as the successful bidder. After the approval of the Cabinet, the Chandigarh Power Distribution Limited (CPDL) was formed. To safeguard the interests of the employees, who are proposed to be transferred to the CPDL, the Chandigarh Electricity Employees’ Master Trust has been incorporated under the Indian Trust Act, 1882. The trust will deal with all terminal liabilities of the transferred employees and an amount of Rs 263 crore will be transferred on this account by the company.
The administration had invited bids on November 9, 2020. Seven companies — Sterlite Power, ReNew Wing Energy, NESCL (NTPC), Adani Transmission Ltd, Tata Power, Torrent Power and EEDL — had submitted their bids. On August 5, 2021, the EEDL was declared the highest bidder. The company had quoted a bid of approximately Rs 871 crore, significantly higher than the reserve price of Rs 175 crore.
PR Kumar, president, power distribution, RPSG Group, said, “We are committed to offer best services to consumers. We also stand committed to honour in letter and spirit the service conditions and pensionary benefits of the employees who will be transferred to the company from the department.”
The privatisation of power supply and distribution in Chandigarh will lead to various consumer-centric benefits like improved, proactive, responsive and digitally enabled customer services and will pave way for induction of modern operational technologies.
What is LoI
A letter of intent (LoI) is a document signifying a preliminary commitment by one party to do business with another. It outlines the key terms of a prospective deal.
Trust set up
To safeguard the interests of the employees, the Chandigarh Electricity Employees’ Master Trust has been set up. It will deal with terminal liabilities of staff being transferred to a new company.
