Govt kicks off discom privatization for UTs

Source: LiveMint.com, Nov 11, 2020

India has begun the process of privatizing the electricity distribution companies (discoms) of its Union territories, with Chandigarh taking the first step.

The Chandigarh administration on Tuesday made available the request for proposals to sell 100% government stake in its discom, two people aware of the matter said. A pre-bid meeting will be held on 1 December. The last date to submit bids is 30 December.

“The Chandigarh discom is expected to be awarded by 15 January,” one of the two people cited above said on condition of anonymity.

The notice inviting tender (NIT) floated by the administration of the Union territory is for

“Selection of bidder for purchase of one hundred percent (100%) shares in distribution company responsible for distribution and retail supply of electricity and having distribution license in the union territory of Chandigarh.”

The next set of privatization bids will be shortly called for the discoms of Andaman and Nicobar Islands, Dadar and Nagar Haveli, and Daman and Diu. The discoms of Puducherry and Jammu and Kashmir and Ladakh are not immediately on offer because of issues such as political opposition and security respectively. With the electricity load for Lakshadweep Islands being low, it is also not being considered for privatization at present.

Mint reported on 1 July that the privatization of electricity distribution in Ladakh and Jammu and Kashmir may have to wait because of security and strategic concerns and the challenges of terrain and low power demand.

Deloitte has been mandated to help with the sale process to privatize discoms in the three Union territories of Chandigarh, Puducherry and Andaman and Nicobar Islands. SBI Capital Markets Ltd has received the mandate for Dadar and Nagar Haveli, Daman and Diu, Jammu and Kashmir and Ladakh.

“We are bound by confidentiality obligations and are unable to comment on client-specific matters,” a Deloitte spokesperson said in an emailed response.

Queries emailed to the spokespersons of Union power ministry and SBI Capital Markets Ltd on Tuesday remained unanswered.

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