Deadline extended for PSEB unbundling to 15 March ,2010

Less than a week after Punjab chief minister Parkash Singh Badal met Union power minister Sushil Kumar Shinde, the Centre has granted a record 12th extension for unbundling Punjab State electricity Board (PSEB).

Sources in the Punjab chief minister’s office told FE on Tuesday that the state has been granted an extension of three months—till March 15 for unbundling PSEB. Owing to violent protests that rocked Chandigarh in September, the Centre had agreed to extend the deadline till December 15. The statement from the Centre clearly said that the date had been extended “to enable the state government to complete the unbundling process”. However, the state failed to unbundle the Board in the stipulated time. Chief minister Parkash Singh Badal had thus rushed to meet power minister, Shinde last Friday to plead for another extension.

Sources, however, revealed that Badal had pleaded to Shinde that “this would be the last extension and that Punjab will now trifurcate PSEB into separate legal entities to conduct the separate functions of generation, distribution and transmission”. Eight years have passed since the Electricity Act, 2003 was passed, but Punjab has remained one of the few states to resist unbundling. While many of the non-complying states have taken initial steps towards unbundling, Punjab has not initiated even an in-principle decision.

Besides opposition from employees and farmers, the state has reported an inability to bear the burden of transfer of assets and liabilities of the PSEB, which is reeling under huge accumulated losses and debt.

The controversy surrounding unbundling of the PSEB has been continuing for close to eight years. The farmers, along with Punjab Electricity Employees and their families, the Technical Service Union, and the PSEB Employees Federation, have been protesting against the Electricity Act, 2003 and the privatisation of the electricity board. The farmers say that if Punjab goes ahead with its move to split PSEB into different companies, it may stop the free supply of power to the farm sector.

A senior official told FE that “Punjab is moving towards unbundling and a consensus is being built on this issue to bring all stakeholders—consumers and farmers, employees of the Punjab State Electricity Board, unions and the management—on the path of reforms in the State Electricity Board”.

Source :financial express