Tatas get Mumbai power distribution licence for 25 years

Mumbai: Maharashtra Electricity Regulatory Commission (MERC) has granted distribution licence to Tata Power for Mumbai area for 25 years, from August 16, 2014, to August 15, 2039. Tata Power's licence was valid up to August 15, 2014. The new licence was granted under sub Section (8) of Section 15 of the Electricity Act, 2003.

Tata Power has 500,000 consumers in its area of operation of 475 sq km in Mumbai. The company is creating capacity to serve 1.4 million consumers by FY18-19. Of the 1.4 million, 800,000 would be around slum areas.

In a recent order, MERC directed Tata Power to file a network roll-out plan in six weeks.

MERC said, ''The roll-out plan should bring out it is cost-effective, provides equal access to all categories, creates a level-playing field, and is optimal for the purpose of meeting universal service obligations in a time-bound way.''

Reacting to the order, Tata Power Managing Director Anil Sardana told Business Standard, '' This is a tribute to the support of consumers. It enhances commitment to the consumers of Mumbai.''

Tata Power has launched an investment plan of Rs 1,879 crore for a network spread across its entire licence area between 2014-15 and 2018-19. Chief Operating Officer Ashok Sethi had recently told Business Standard, ''The company has invested Rs 1,000 crore in five years in the Mumbai distribution business. For FY14, we invested Rs 351 crore and capitalised assets worth Rs 302 crore."

MERC had invited expressions of interest (EoIs) in February for the distribution licence in the area serviced by Tata Power in Mumbai. MERC had got EoIs from Tata Power, Maharashtra State Electricity Distribution Company (MahaViataran) and Kolkata-based India Power Corporation.

Adani Power,Torrent Power, Reliance Infrastructure, GMR, GVK and Calcutta Electric Supply did not send EoIs.

MERC, which held public hearing in this regard, rejected EoI filed by MahaVitaran and India Power Corporation while granting licence to Tata Power after fulfillment of required norms.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.