A discussion paper is to come out on a new business model, where the power supplier and the electricity distribution network provider will be separate entities. The Union Power Ministry is likely to float the paper soon. The idea of segregating supplier and the entity that manages the power distribution network is primarily aimed at reducing losses of discoms and improve overall efficiency.
The discussion paper on having separate carriage and content (electricity) model for the power sector is likely to be floated by end of this month, sources said.
The new plan, similar to the one being followed in the United Kingdom, comes at a time when many of the country’s power distribution companies (discoms) are grappling with significant debt burden. Currently, discoms supply as well as manage network that provides electricity for residential and commercial purposes.
The new model could be introduced only after effecting amendments to the Electricity Act 2003. Most of the State-owned discoms are deep in the red and their cumulative losses touched Rs 2.46 lakh crore at the end of March 2012.
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