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Suresh Prabhu: A tenure of reforms cut short

BS Economy Bureau in New Delhi

Kickstarting state-level reforms in the distribution sector and pushing states to make their electricity boards financially viable were the highlights of Suresh Prabhu's two-year stint at the helm of the Union power ministry.

Although Prabhu cannot claim to have pushed the sector full steam into the reforms path, his beginning in persuading states to achieve metering of consumers, insistence on regulatory framework for tariff fixing and incentive-based reform measures had started making an impact.

The much-hyped Electricity Bill 2000, which promised deregulation of the sector, is still pending before the parliamentary standing committee and has failed to see the light of the day.

The Accelerated Power Development and Reform Programme, launched by the ministry in February 2002, placed the thrust on states to initiate time-bound reform measures in order to avail of Central funds and starting the reforms at the distribution circle-level.

State governments have started initiated measures prescribed under the programme for availing the funds, for which a provision of Rs 3,500 crore (Rs 35 billion) has been made for the fiscal.

One of the success of the Prabhu's reform initiatives has been on persuading states to set up regulatory commissions, who have begun the process of tariff rationalisation in most states.

Getting states to settle a substantial portion of accumulated dues Of around Rs 43,000 crore (Rs 430 billion) with Central PSUs though the Ahluwalia committee's one-time settlement scheme has also been a success, with about 22 states having signed the tri-partite agreements for securitisation of past dues.

Prabhu has done considerably well in roping in states for undertaking reform-linked milestones through signing of MoUs.

Nearly 20 states have already signed the MoUs and some of these states, particularly Haryana, Himachal Pradesh, Rajasthan, Madhya Pradesh, Himachal Pradesh, Tamil Nadu and Karnataka are doing well in terms of achievement of milestones set in the MoUs (like 11 kV metering, energy audits and general bottom line improvement).

On the other hand, the traditional laggards like Uttar Pradesh, Bihar, Jharkhand continue to stay away from these reform initiatives.

During his tenure, the power ministry turned its focus back on the CPSUs and the state sector for the capacity addition of 1,00,000 MW planned during the next two plan periods.

Achievement of 100 per cent consumer metering was another of Prabhu's targets set when he took office.

While states during the past one years have been persuaded to achieve close to 100 per cent of 11 kV meters, but in case of consumer metering, which was expected to be completed by December 2001, only about 70 per cent achievement can be claimed.

Even though officials claim 100 per cent metering is a tough job across states, but unless consumer metering is completed, misclassification will continue.

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