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JULY-SEPTEMBER, 2002VOL. 3
NO.3 The Orissa government has given an ultimatum to the Bombay suburban electricity Supply corporation (BSES) to provide unconditional and legally enforceable bank/corporate guarantee to Gridco to back up latter’s proposed tripartite agreement with NTPC for clearance of dues. The government has given 30 days to BSES to comply with the ultimatum. If the company failed to give corporate guarantee by this deadline, Orissa Electricity Regulatory Commission will be approached for appropriate action against it, the Cabinet decided. BSES which owns three of the four power distribution companies in the state., who supplies power to the consumers buying it from Gridco. The state-owned bulk power trader Gridco has been complaining that it was unable to clear the dues of NTPC because of nonpayment of bills by distribution companies who purchased bulk power from it. In these circumstances, as a back to back arrangement for securitisation of NTPC dues, the government had sought corporate guarantee from BSES.
For giving corporate guarantee BSES had set certain conditions which included
implementation of the recommendations of the Sovan Kanungo committee report
which had suggested certain corrective measurers to make the utilities operating
in the state viable and relaxation of escrow arrangement with Gridco for the
purpose of giving salaries to the employees of distribution companies, however
the state cabinet has rejected the conditions. |
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