Uttar Pradesh plans to privatize electricity distribution to address financial losses. Private sector participation will be introduced in high-loss regions, despite protests by employees. The power sector will be privatized in a 50-50 model in the high lossmaking areas of UP.
According to sources, the plan is not to privatize completely but to have a partnership with a private company.
The decision was taken following a high-level meeting attended by the Chairman of UP Power Corporation and the managing director of distribution companies.
The plan is to make betterment in areas giving heavy financial losses.
In such areas, the government plans to enter into partnerships with the private players to overcome high fiscal losses.
According to financial assessment, the expenses incurred in buying electricity were much higher than what the earnings were after its sale.
At the moment the power department was suffering a loss of 1.10 lakh crore.
This year the power corporation has taken 46130 from the government. Next year it will need another 50 to 55 thousand crore from the government and then 60 to 65 thousand crore in the next year.
The beginning of sucprivatizationon could begin from Purvanchal Vidyut Vitran Nigam Varanasi and Dakshinanchal Vidyut Vitran Nigam Agra.
These are the two areas where the government has been suffering heavy financial losses.
