BHUBANESWAR: In a move to encourage private investment in power transmission sector the State government has initiated process to adopt tariff-based competitive bidding (TBCB) for future development of intra-state transmission projects.
The State government has also decided in principle and informed Odisha Electricity Regulatory Commission (OERC) that Odisha Power Transmission Corporation Limited (OPTCL), which is looking after the transmission activities within the State, is also contemplating to execute all 400 KV and above transmission project under TBCB mode.
The State government’s decision to enter the new regime stems from the fact that tariff discovered through TBCB is lower by about 30-40 per cent compared to cost-plus transmission tariff for projects executed through regulated tariff mechanism (RTM).
Under the proposed TBCB, new transmission projects will be implemented through bidding process. The successful bidder or the transmission service provider (TSP) will execute the projects under build, own, operate and transfer (BOOT) mode.
The TSP will enter into a transmission service agreement (TSA) with OPTCL for payment of the transmission charges to be finalised on the basis of competitive bidding. Explaining the need to adopt the new regime, a senior executive of OPTCL said it is imperative to make the transmission system more efficient, cost effective and technology driven to meet the rising demand of electricity in the State.
With a total installed capacity of 7,752 MW (excluding CGPs), the present energy requirement is about 5,000 MW and this is likely to increase to about 8,000 MW by 2030 as per Gridco assessment.
The rising trend of electricity demand, additional generation of renewable energy in the State and integration of power system at the regional level required a robust transmission system for smooth flow of electricity to ensure reliable power supply to consumer round the clock.
“Competition in transmission business will bring technology innovation, reduction in tariff and timely completion of projects. The investment from private players in transmission business will also help the State government to divert fund for other priority sector,” the officer said.
Presently, the transmission tariff of OPTCL is lower compared to other states. However, the transmission losses is on higher side compared to states like Delhi, Haryana and Punjab. OERC has sought views and suggestions of stakeholders as per the national tariff policy. The United Forum of OPTCL Employees Association opposed to the move callig it a step for privatisation of transmission business.