BHUBANESWAR: With an accumulated loss of Rs 2,424.23 crore till 2012-13, the Reliance Infrastructure (R-Infra)-managed distribution companies (discoms) have defaulted to clear arrear amounting to Rs 2,613.47 crore to Gridco towards bulk supply of power.
As per the audited account of the three distribution companies, a staggering amount of Rs 2,456.40 crore remained unrealised from the consumers by the end of 2012-13 financial year.
The Odisha Electricity Regulatory Commission (OERC) revoked the distribution licence of the three discoms - Nesco, Wesco and Southco - last week for their miserable performance in key areas such as controlling technical and commercial loss, billing, payment of arrears to Gridco and servicing NTPC bond.
Failure of the three discoms to reduce the technical and distribution loss and realise revenue from consumers during the last 15 years has landed them in financial mess. As on March 31, 2013, the net worth of Nesco was eroded by Rs 775.21 crore while the erosion of Wesco and Southco was Rs 595.63 crore and Rs 706.59 crore respectively.
“The huge negative net worth is the main reason for which the discoms are unable to access funds from the market either for their capital works or daily operational requirement. This makes the system universally unworthy of credit,” the OERC order stated.
Even after 15 years of operation, the licensees have consistently failed to reduce the distribution loss making the discoms unviable. Nesco has been able to bring the distribution loss from 37 per cent in 2005-06 to 33.84 per cent in 2013-14 while in case of Wesco it was 36.68 per cent as against 37.8 per cent during the same period.
With highest loss level at 41 per cent in 2005-06, Southco failed to bring down the distribution loss even by one per cent till 2013-14.
“One per cent loss reduction at present level would have resulted in additional revenue of around Rs 26 crore for Nesco, Rs 36 crore for Wesco and Rs 13 crore for Southco,” the OERC order said.
The three discoms were privatised with transfer of majority stake of 51 per cent to BSES Ltd on April 1, 1999. BSES, however, diluted its share over a period of time in favour of Reliance Group companies without prior permission of OERC.
The equity infused by the investor at the time of privatisation was Rs 65.91 crore for Nesco, Rs 48.65 crore for Wesco and Rs 37.66 crore for Southco. Though the State Government extended financial support of Rs 1,464 crore to the discoms through CAPEX in 2011-12, the Reliance Group of companies failed to arrange matching contribution till date.