Inaugurating the Assocham seminar on ``Developing the power market in India by 2010,'' Pant said the government should create an electricity pool that would give open access to transmission and distribution facilities by various utilities and enable transportation of power from one region to other at the minimum cost to the consumers.

"Government should set up a wholesale electricity market and take effective steps to create a electricity pool and enforce market like competitive pressures," he said.

"This would encourage competition not only among various generating companies but also at the distribution level and would enable improvements inrevenue collection with adequate tariffs," he said.

Pant said the focus should be on the power pooling arrangements and the possible market structure for such power pools. While the pooling infrastructure comprising regional grids is already in place, ``it is time to ponder over the improvements that are required to realise additional economic and operational benefits through power pooling.''

Pant said that investment in transmission facilities has not kept pace with generation investment. The shortages in energy and peak demand are well-known, but the deficiencies in transmission also continue to limit the ability of regional despatch operations to transfer the bulk power from one region to another and to operate the transmission network in a secure condition at the lowest possible cost.

For this purpose, transmission should be planned in an integrated manner at the state and Central level for obtaining the maximum economic benefits from scarce financial resources, Pant said.

``The efforts to makethe national grid functional in a time-bound manner have to be expedited'', he said.

The deputy chairman said there was need to make an assessment of whether there was any requirement for an independent system operator to control the transfer and trading of power and adopt a model most suited for the Indian power system.

Responding to the Assocham president K P Singh's observation that despite reforms, projects in the pipeline were not getting off the ground, Pant said the pace of reforms needs to be continued further to create as healthy power market which encourages private investment and acts as a catalyst resulting in continuous cycle of improvements in the quality of power supply and adequate returns for investors.

Plans for state level power sector reforms should address the three basic issues, rationalisation of tariff, privatisation of distribution and establishment of independent regulatory commission. Uniform set of reform and restructuring proposals may not give perfect solutions for all thestates considering the differences existing across India in various states.

Therefore, the suggested reforms must suit the needs of each particular state, he said. Pradip Baijal, special secretary, ministry of power said the Central Electricity Regulatory Commission Act and the Electricity Laws Amendment Act facilitate the setting up of regulatory commissions and creation of a national grid and regional grids for wheeling of power from power surplus to deficit areas.

The development of a healthy and vibrant power market in India would ensure that every power utility would have the right to get on to the transmission and distribution networks developed by the private sector, Baijal said. K P Singh, president, Assocham said the government has tried to galvanise the power sector through a series of relentless reforms the familiar bottlenecks still remain blocking all efforts for a breakthrough. Most states are reluctant to shed old mindsets which keeps most projects on paper keeping financial closure adistant prospect, he said.

The Ninth Plan period envisages a capacity addition of40, 425 mw and as against the average capacity addition of 8,000 mw per year, the capacity addition during the first two years of the plan period is only 7528.3 mw, he said. Power supply position as on March 1999 indicates energy shortage of around six per cent and peak shortage of around 14 per cent, the deputy chairman said.