The total capacity addition of 5,841 mw would be possible through the state sector (1,522 mw), the central sector (1,346 mw) and IPPs (2,972 mw). The capacity addition by the private sector includes Dabhol phase-II - 1,444 mw, Reliance - 447 mw and Bhadrawati project - 1,082 mw.

Crisil which has been appointed as the consultant of the ailing Maharashtra State Electricity Board (MSEB) has, however, said that the management of suprlus power would be imperative. It has stressed the need for pursuing demand side management measures especially through time of day (TOD) metering to address peak deficits.

Crisil in a recent presentation to the state finance minister Jayant Patil and minister of state for energy Rajendra Darda had emphasised that the state government support would be required to meet cash flow adequacy during the transition period.

It has ruled out the possibility of further tariff hike other than a six per cent which has been ordered by the Maharashtra Electricity Regulatory Commission (MERC) during current fiscal.

Crisil has also said that tariff hike of 12 to 19 per cent for cash flow adequacy in 2001-02 is unlikely to be approved by MERC.

Crisil has predicted that firm capacity addition of 2,684 mw including 1,444 mw by DPC in the first phase would lead to a significant deficits of Rs 1,550 crore-Rs 1,950 crore in the intermediate years. It has recommended that additional capacity addition beyond 2,684 mw should be pursued only after substantial progress is demonstrated in this respect. It has called for a review after 12 to 18 months.

Crisil has projected that domestic realisation would be equal to cost of supply by 2003-04 while agricultural realisation would be equal to 50 per cent of the cost of supply during the same period. Public lighting and public waterworks would be equal to 100 per cent of cost of supply and inter-state realisation to be equal to 105 per cent of cost of supply in each of the years. Interestingly, industrial high tension, low tension and commercial consumers would account for balance revenues.

Crisil has estimated a drastic fall in the transmission and distribution losses from as high as 31.87 per cent in 2000 to 27.67 per cent in 2001 to 26.17 per cent in 2002 to 24.67 per cent in 2003 to 23.17 per cent in 2004 to 21.67 per cent in 2005 to 20.17 per cent in 2006 to 18.67 per cent in 2007.

Crisil's projections may bring relief to the cash-strapped MSEB which has been asked to cut transmission and distribution losses by five per cent in the current fiscal by MERC. MSEB has, however, expressed its inability to do so in view of a large amount of financial requirement needed for it.