KSEBOA - KSEB Officers' Association

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The Tamil Nadu Electricity Board (TNEB) has invited tenders to engage the services of a consultant to restructure the board in accordance with a central legislation, the Electricity Act, 2003. The state government had sought an extension of deadline to implement the EB's rebundling process by six months.The board will be restructured into a holding company and two subsidiaries.

The consultants would also undertake balance sheet segregation and suggest improvements in asset management systems and procedures to ensure compliance and incorporation of all the three companies. According to sources, the bidders have to submit their quotation by January 21. The successful consultant firm has to furnish the preliminary report within 15 days from the date of receipt of the order. Besides the formulation of an implementation strategy for restructuring of TNEB, the consultants would have to list down the key tasks to be carried out for state power sector restructuring along with the timelines and responsibility matrix.

The government and TNEB require consultancy assistance in technical, financial, personnel and legal aspects to advise them on compliance to provisions of the Act and to create consensus among various stake holders. The consultancy firm will assist the government and the TNEB in studying the impact of the restructuring on technical and commercial aspects, its alignment with the Act provisions and the prospects of long-term sustainability of the sector. The effect on the work force will also be studied.

Besides the preliminary report, the consultancy firm after an exhaustive exercise will submit seven reports under various heads including organisation structure, financial restructuring and configuration, organisational and human resources, transfer scheme, corporation and commercialisation, legal and strengthening of the load despatch function.

Meanwhile, with the Tamil Nadu government seeking more time from the centre to complete the process, the consultant would be given three months to submit its report.

The holding company would be called the TNEB limited and the subsidiaries would be known as the Tamil Nadu Transmission Corporation Limited and the Tamil Nadu Generation and Distribution Corporation Limited. All the companies would be fully owned by the government and there would be no retrenchment, said EB officials.

While giving in-principle approval for the formation of two subsidiary companies and a holding company, the government had constituted a steering committee headed by the energy secretary, comprising TNEB chairman and finance secretary to finalise a scheme of transfer of assets and liabilities to the proposed entities in six months.

The restructuring of the TNEB has been in the anvil for the last ten years. In 1999, the TNEB appointed Ernst & Young as consultant to advise it on restructuring the board. The TNEB, a year later, had decided to restructure itself into three profit and responsibility centres covering generation, transmission and distribution.

The consultant had given two options to the TNEB -- either restructure into three autonomous profit and responsibility centres or segregate into three separate corporations or companies. The consultant had even favoured unbundling the TNEB rather than restructuring into profit and responsibility centres. However, the move was stiffly opposed by the unions then and the government gave up the proposal.


Source - Times of India