Discom Privatisation: Tata Power And IPCL Bid For Odisha’s Central Electricity Supply Unit  

A power sub station near Konark in Odisha. (Photo by Indranil Bhoumik/Mint via Getty Images)

Odisha’s Central Electricity Supply Unit (CESU) which is being privatised after 17 years has received bids from Tata Power and India Power Corporation Ltd (IPCL). This would be first privatisation of a power distribution company (Discom) after the licenses for Delhi Vidyut Board was handed out to Tata Power Delhi Distribution Ltd and BSES Delhi.

The State Electricity Regulatory Commission had called for bids in relation to the sale of CESU in December 2017 with the successful bidder enjoying the right to manage, invest and operate the company for a period of 25 years.

CESU is a potentially attractive option as its distribution area covers 19 per cent of the state’s area with the major cities of Bhubaneshwar, Cuttack, Paradeep, Angul and Talcher falling within its ambit. The revenue potential is estimated to be in the region of Rs 3000 crores with the utility servicing around twenty lakh consumers.

The privatisation effort comes even as the NDA government formulates plans to impose penalties on power distribution companies for load shedding. The financial condition of CESU is not too healthy either with the discom reeling under a debt burden of Rs 2000 crore while receivables stand at Rs 1700 crore.

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