“Pleas of Electricity Department employees may have fallen on deaf ears, but their prayers have been answered. After the decision of the Centre to frame a uniform policy for the privatisation of the Electricity Department of all union territories, the UT Administration has put the department privatisation process on hold.

The privatisation process of the Electricity Department has been put on hold till the Centre frames a new policy regarding the formation of a company and the process to be adopted for the transfer of shares. — Manoj Parida, UT Adviser

“The privatisation process of the Electricity Department has been put on hold till the Centre frames a new policy regarding the formation of a company and the process to be adopted for the transfer of shares,” said UT Adviser Manoj Parida.

On November 9, 2020, the UT Engineering Department had invited bids for the privatisation of the Electricity Department.

On a petition filed by the UT Powermen Union, a Division Bench of the Punjab and Haryana High Court had on December 1, 2020, stayed the tendering process regarding the privatisation of the Electricity Department.

The petitioner had contended that they were aggrieved by the decision to privatise the electricity wing by selling 100 per cent stake of the government in the absence of any provision under Section 131 of the Electricity Act, 2003.

The Bench was also told that the process of privatisation of the wing could not be initiated at all, especially when it was running in profits. The sale of 100 per cent stake was unjust and illegal as the wing was revenue surplus for the past three years. It was economically efficient, having transmission and distribution losses less than the target of 15 per cent fixed by the Ministry of Power.

However, On January 12, the Supreme Court had stayed the order of the High Court and on January 14, the UT Administration resumed the sale of tender for the privatisation process.”

2   It is suggested that the following line of action may be adopted by MoP/GOI.

i)     In line with the decision to adopt uniform policy/line of action, to begin with the decision for  privatization of power discoms  ( ref minutes of MoP meeting dt 12 May 2020) must be withdrawn .

ii)     The draft standard bidding documents circulated on 20 Sept 2020 must necessarily be withdrawn, only then  the process for revising procedure  can be taken up . So long as SBDs remain in pipeline it would not be possible to revise the procedure.  The slate has to be made clean.

iii)    The revised draft procedure ( for new company formation and shares transfer)  if and when finalized must be put up in public domain for comments  ( as in the case of SBDs issued on 20-9-2020.) Public scrutiny and debate is most essential.

iv)    The policy decision as announced for Chandigarh necessarily implies  that the earlier SBD draft of 20-9-2020  is no longer  valid or in consideration. This should be confirmed by GOI.

v)    GOI must declare that there will be no move to privatise any  discom (State or UT) in future   since the  process/methodology is not  finalized. The recent privatization of Odisha must be rolled back.

vi)    GOI must withdraw its  declared policy  for privatization of electricity Discoms . Moves or proposals for privatization   as may have been initiated in J&K, Ladakh, D&NH Daman and Diu , Purvanchal etc  must necessarily be shelved/put on hold.

vii)    Repeated experimentation with Discoms structure  is not the correct policy . Whatever improvement is envisaged can certainly be achieved within the existing public sector framework and the issue of privatization itself is unwarranted ab-initio. This is the new policy we suggest that GOI must adopt.

With Regards.

Sincerely Yours

Shailendra Dubey

Chairman