High Court stays Chandigarh discom privatisation

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December 3, 2020 8:30 AM

Staying the bid invitation process which started on November 10, the court remarked that “we feel that the matter will require detailed deliberations as it touches the employment scheme of the society in general”.

He cited an example of a state where the tariffs have not increased for three years and the state is in financial trouble.He cited an example of a state where the tariffs have not increased for three years and the state is in financial trouble.

The High Court of Punjab and Haryana has put in abeyance the privatisation of the Chandigarh electricity distribution company (discom), following protests from its engineers and other workers. Staying the bid invitation process which started on November 10, the court remarked that “we feel that the matter will require detailed deliberations as it touches the employment scheme of the society in general”. The development follows the Uttar Pradesh government suspending its plan to unbundle and privatise the Varanasi discom, Purvanchal Vidyut Vitran Nigam (PVVNL).

To usher in efficiency, the government was initially planning to privatise the discoms in Union Territories (UTs) by January 2021, and Chandigarh was first UT to issue notice inviting bids for the same.

The Centre had announced in May that power departments and distribution utilities in UTs will be privatised. Finance minister Nirmala Sitharaman had then said that privatisation of UT discoms will “provide a model for emulation by other utilities across the country”.

In its petition against privatisation, the UT Powermen Union said that “no provision has been framed for reservation policy for the OBC, BC, sports personnel, ex-army personnel and various deprived sections of the society”.

The petitioners also pointed that the Chandigarh discom is running in profits and has transmission and distribution losses of less than 15%, which is the target fixed by the Union power ministry.

The Union government has been pushing discoms to increase private sector participation to achieve higher efficiency. Sources said that to achieve that target, joint ventures among CPSUs and private players was also being contemplated in the power distribution sector.

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