Even though, Franchisee model is a failure in India, it will be implemented in nine cities of Uttar Pradesh power distribution by March 2009. This follows a decision taken by the state cabinet earlier. Feedback Ventures has been appointed as the consultant to prepare the blueprint for the proposed system. However, the state power employees and engineers are opposing this move.
The selected franchisee will be allotted electricity units at a fixed price and they will realise revenue from consumers and in turn repay UPPCL for a profit. The Request for Qualification-cum-Request for Proposal (RfQ-cum-RfP) document is available for the interested parties. While, the RfQs are scheduled to be opened on February 14, the RfP will open on February 16, official sources told .
On the basis of the bidding terms, the net worth of the private firm should be more than Rs 75 crore for Kanpur and Rs 50 crore for other cities.Besides, the annual turnover of the firm in the last 3 years should be Rs 350 crore for Kanpur, Rs 250 crore for Agra and Rs 150 crore for other places.The average gross cash accrual of the firm in the last 3 years should be Rs 50 crore for Agra and Kanpur and Rs 25 crore for other places.
Recently, power major Torrent officials had visited Kanpur and Agra to study the transmission system at the two places to gear up for the bidding.Torrent already distributes power in Ahmedabad in Gujarat and Bhiwandi in Rajasthan.
“Under the system, the state power corporation will sell power to the franchisee, which in turn will be free to carry out the distribution at a price prescribed by SERC (State Electricity Regulatory Commission),” the commission’s chairman Navneet Sehgal told IANS.
“Agra, Kanpur, Moradabad, Bareilly and Gorakhpur will be covered in the first phase, while Varanasi, Meerut, Allahabad and Aligarh will follow later,” he said.
Maintaining that these cities incurred the most losses, Sehgal said: “The new system is expected to bring about a turnaround.” The contract will be awarded for 20 years, and bidders will be required to submit a detailed proposal for the entire period.
Asked whether the switchover to the new model would affect UPPCL employees, Sehgal said employees would be given the option of proceeding on deputation to the franchisee. “They will continue to enjoy the same remuneration and perquisites they are entitled to now.”
Power Employees Joint Action Committee spokesperson Shailendra Dubey said they were ready to pay the state government one paise above the franchisee, who quotes highest price in bidding.
Source - Indo-Asian News Service