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Home News Power Sector News MESDCL terminates power distribution franchisee for Jalgoan

MESDCL terminates power distribution franchisee for Jalgoan

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MaharashtraJalgoan In Maharashtra MSEDCL has taken over the complete power distribution of Jalgoan. After terminating the contract of power distribution awarded to franchisee Crompton Greaves over default in payments.
Sunil Jagtap General Secretary of Subordinate Engineers Association said that Crompton Greaves have not done any payment to MSEDCL since 30th May .The balance outstanding payment is Rs. 99 crore whereas bank Guarantee available with MSEDCL is only Rs. 75 crore. Moreover no capital investment for system improvement is done by the Franchisee for the last two months.

The Association has welcomed the decision to cancel the franchisee contract and last year the contract for Aurangabad franchisee was cancelled. The franchisee policy has a number of lacunae as such the franchisee was not giving full agreed amount to the power utility. Crompton had taken over Jalgaon city distribution in 2011 on a ten year contract.

The huge defaults took place in Jalgaon and Aurangabad because MSEDCL did not force the two franchisee companies to open an escrow account.

V K Gupta Spokesperson of All India power Engineers Federation said that it is very clear that urban distribution franchisee has nothing to do with improvement it is simply a mechanism to privatize the profits which is not in the national interest. As far as losses are concerned AT & C losses can be better controlled & reduced within the frame work of public sector functioning with a professionally qualified & technically oriented management to guide the policy & with the condition that political interference in day to day working in avoided.

Source- Mint


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