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Deputy Chairman of Planning
Commission Montek Singh
Ahluwalia opined that states must
encourage Public Private Partnership
(PPP) model in their power distribution
utilities. At a recent conference in the
capital by CII, Ahluwalia mentioned that
PPP model in the distribution section has
been very successful in Delhi making the
distribution side of the chain financially
healthy.
He pointed out that states governments
are quite aggressively implementing PPP
model for achieving infrastructure goals.
In power sector, states are keen on
implementing PPP model for generation
projects; however, no other state
government except Delhi has
implemented this model in managing
distribution systems.
Ahluwalia pointed out that it is
imperative that the States strive towards
improving the financial health of the
distribution companies as that is the
ultimate revenue generator for the entire
power sector. He mentioned that the PPP
model will specially benefit the states
with large cities and improve the overall
financial health of its utilities, giving an
impetus to the overall power sector
development.
Though the power sector has made
considerable progress in adding
generation capacities, there still lies a
huge difference when compared to the
progress in distribution side of the sector,
which has relatively been quite slow.
Though the government has endeavoured
to strengthen the distribution business
through measures under the APDRP
scheme, there remain many distribution
utilities that are still registering huge
losses and are financially weak.
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