8 companies bid for MERC's power licence, R-Infra skips

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Differences between Reliance Infrastructure (R-Infra), an Anil Dhirubhai Ambani Group company, and the Maharashtra Electricity Regulatory Commission (MERC) over the auctioning of power distribution licence have resurfaced. R-Infra has not filed any expression of interest (EoI), but submitted a petition seeking amendment to the existing distribution licence conditions (extension of licence period) under Section-18 of the Electricity Act, 2003.

MERC has received EoIs from Maharashtra Electricity Distribution Company (MahaVitaran), Torrent Power, DPSC Ltd, Lanco Infrastructure, GMR Energy, Indiabulls Power, The Tata Power Company, and Enzen Global Solution.

The auction, which is being done for the first time at the national level since the implementation of the Electricity Act, 2003, is necessary, as R-Infra’s distribution licence expires in August 2011. Both MERC and R-Infra differ on the issue. While MERC claims that EoIs were invited pursuant to section-86 (1)(d), along with section 14, of the Electricity Act, 2003, R-Infra argues that there is no provision in the Act for bidding of the licence.

R-Infra sources told Business Standard that: “The company is opposed to EoI. As per the Electricity laws, the regulatory commission cannot refuse licence to any applicant, provided he meets the qualifying criteria of creditworthiness, capital adequacy and code of conduct.”

MERC sources said consumers would get multiple choices to meet their power demands in the suburbs of Mumbai. They informed that R-Infra, in its petition, indicated that if the petition was rejected, it (the petition) could be converted into the company’s EoI.