Deadline for transfer of Power Dept assets to pvt firm extended by month
The UT Administration has extended the deadline for handing over assets of the Electricity Department to a Kolkata-based private company by almost a month. Earlier, the liabilities were to be transferred by the end of this month. An official stated that all liabilities of the department were likely to be transferred to the private firm by first week of February as documentation and paperwork needed more time.
On the other hand, Congress and employees of the department have been protesting against the privatisation of the department. The city Congress had started a seven-day chain hunger strike from December 18, while employees have been staging daily protests since November 7 after the Punjab and Haryana High Court dismissed their petition.
The UT Administration had invited bids for the privatisation of the department on November 9, 2020. Kolkata-based Eminent Electricity Distribution Limited (EEDL), a subsidiary of the RP Sanjiv Goenka (RPSG) Group, was declared the highest bidder on August 5, 2021. The company had quoted a bid of approximately Rs 871 crore, significantly higher than the reserve price of Rs 175 crore.
Firm denies allegations, calls rumours baseless
In a statement, the private firm has asserted that a section of individuals had been spreading rumours about the privatisation of electricity in Chandigarh. The allegations include claims that employees’ jobs are at risk, electricity prices will rise and that the Administration had handed over a profitable department to a private entity. The firm refuted these claims, calling these baseless and part of a deliberate effort to mislead residents.
The firm clarified that the Electricity Act, 2003, along with conditions specified in the tender, ensured the protection of employees’ jobs and preserved their service conditions after transfer to the private distribution company. It emphasised that employees’ service terms could only be enhanced, ensuring no reduction in benefits or rights post-privatisation. This includes safeguarding salaries, allowances, pensions and other benefits such as gratuity, earned leave and provident fund.
The firm also addressed the department’s financial status, revealing that the Chandigarh Electricity Department had incurred losses of Rs 157.04 crore in FY 2021-22. Additionally, the Joint Electricity Regulatory Commission (JERC) projected revenue shortfalls of Rs 158.91 crore for FY 2023-24 and Rs 198.71 crore for FY 2024-25, based on pre-revised tariffs. The department has repeatedly failed to meet its loss reduction targets, leading to penalties year after year.
The UT Administration reiterated that even after privatisation electricity rates would stil be regulated by the JERC.
The firm added, “Privatisation of Chandigarh’s electricity sector is a necessary step to address financial challenges, enhance service efficiency and ensure long-term sustainability. We urge residents to disregard misinformation and trust the facts provided by the Administration. This initiative aims to establish a stronger and more reliable electricity distribution system for the benefit of all Chandigarh residents.”
