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CESC, Adani, Tata  in race for Odisha discoms

The discoms are the Western Electricity Supply Utility of Odisha Ltd (Wesco), North Eastern Electricity Supply Co. of Odisha Ltd (Nesco) and the Southern Electricity Supply Co. of Orissa Ltd (Southco). (Photo:Mint)Premium
The discoms are the Western Electricity Supply Utility of Odisha Ltd (Wesco), North Eastern Electricity Supply Co. of Odisha Ltd (Nesco) and the Southern Electricity Supply Co. of Orissa Ltd (Southco). (Photo:Mint)

The privatization drive of the three discoms is spearheaded by the Odisha Electricity Regulatory Commission (OERC). Crisil has the mandate for managing the sale of Wesco and Southco, while Deloitte will handle Nesco

The Adani Group, RP-Sanjiv Goenka group’s CESC Ltd and Tata Power Co. Ltd have evinced interest in the three electricity distribution companies (discoms) being privatized by the Odisha government, said two people aware of the development.

The discoms are the Western Electricity Supply Utility of Odisha Ltd (Wesco), North Eastern Electricity Supply Co. of Odisha Ltd (Nesco) and the Southern Electricity Supply Co. of Orissa Ltd (Southco).

“Among those who have evinced interest in placing bids for these discoms are CESC, Tata Power and Adani. All of them have experience in running discom businesses," said one of the two people mentioned above requesting anonymity. “Wesco and Nesco have high industrial load," the person said, referring to high consumption by industrial consumers in the two discoms.

The privatization drive of the three discoms is spearheaded by the Odisha Electricity Regulatory Commission (OERC). Crisil has the mandate for managing the sale of Wesco and Southco, while Deloitte will handle Nesco.

Spokespersons for CESC and Adani Group declined to comment. A Crisil spokesperson said in an emailed response, “We won’t be able to comment on this as it’s specific to a mandate." Queries emailed to spokespersons for Tata Power and Deloitte on Friday remained unanswered.

Odisha’s plans underscore those of other states that are gradually shifting to the idea of privatizing their debt-laden discoms to raise funds. The financial health of states has been weakened by the prolonged lockdown.

Debt burden of discoms is expected to touch a record 4.5 trillion this fiscal, according to a Crisil Ratings report. The mounting debt could further erode the already-poor financials of discoms, with states struggling to pay for electricity bought because of lower realizations.

The move to privatize the three discoms in Odisha comes after Tata Power won a 25-year licence in December for distribution and retail supply of power in five circles of the Central Electricity Supply Utility of Odisha (CESU). Tata Power plans to make a capital expenditure of 1,541 crore through fiscal year 2025 in CESU.

Odisha has an average power demand of 4,000 megawatts (MW). Wesco supplies power in the distribution circles of Rourkela, Burla, Balgarh, Bolangir and Bhawanipatna, while Southco caters to Behrampur, Aska, Bhanjanagar, Jeypore and Rayagada. Nesco supplies power to Balasore, Mayurbhanj, Keonjhar, Jajpur, and Bhadrak.

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