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BOARD RECOMMENDS THREE COMPANIES FOR UNBUNDLING


Punjab state electricity Board (PSEB) has recommended  to set up three companies in order to bifurcate it in accordance with Electricity Act 2003. PSEB has sent its proposal to Punjab government to implement it.
PSEB sources said on Wednesday that PSEB has advised Punjab government to three companies comprising generation, transmission and distribution companies.
The dead line for unbundling of Punjab State Electricity Board (PSEB) has already been extended upto June 15,2009.
The center government had asked all the states to disband power boards and set up independent companies for handling generation and distribution of electricity as per the provisions of Electricity Act. 2003.
Giving last opportunity the Centre has asked Punjab to prepare road map for bifurcation of the board; hence PESB has sent the proposal to the Punjab government in view of it. 
Punjab Government had received concurrence of Government of India allowing PSEB to continue as a vertically integrated utility till 15th June, 2009. This is the ninth extension granted to state government. The last extension had expired in November 2008.
The PSEB, the biggest PSU in Punjab has a strength of about one lakh employees. The employees associations had threatened to launch agitation if PSEB was unbundled.
The PSEB Engineers Association has suggested that it is possible to retain the board without disturbing the present set up of the PSEB to meet the legal requirements of Electricity Act 2003. This can be done by creating a new company to trade power as per provisions of the Act 2003.There are seven states in the country where the State Electricity Boards still exist due to pressure build by board employees. 
The former chairman of PSEB Y S Ratra has advocated unbundling in the month of January and lost his job. He called for implementing the recommendations of the Electricity Act 2003.
The Punjab government, earlier this year,  had reappointed Ernest and Young, as consultant to submit report on the restructuring of the PSEB. Earlier also this consultant had suggested formation of separate companies for generation, transmission and distribution companies besides a holding company in 2004.
Several unions and association however have opposed the move. According to PSEB engineers body the restructuring of PSEB is a high risk, low return and irreversible process and all the stake holders must be involved in the process. Government would have to take the responsibility of conversion of state Government loans in to equity and taking over the liabilities related to employee's retirement benefits. Failure of reform process in different states is attributed mainly  to political interferences in day to day working of the state power utilities.

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