Rs 1,879-cr capex in Mumbai: Tata Power

Investment for laying backbone network and increasing consumer base in the city

Tata Power, which has sought renewal of its distribution licence for the Mumbai area, has an investment plan of Rs 1,879 crore for a backbone network between this financial year and 2018-19.

The firm aims to expand its consumer base, now 500,000, by supplying power in south Mumbai and the city's suburbs. It will be able to provide power to low-end customers with monthly demand of 300 units in the wake of recent judgements from the Supreme Court. And, raise its presence in 11 clusters at the suburbs, due to the recent ruling from the Maharashtra Electricity Regulatory Commission.

Tata Power presented its business plan to MERC during a public hearing last week. The distribution licence term will be over on August 15 and MERC is expected to give its ruling by August 10 in this regard.

Ashok Sethi, chief operating officer, told Business Standard: ''The company has already invested Rs 1,000 crore in the past five years in the Mumbai distribution business. For the last financial year (FY14), we invested Rs 351 crore and capitalised assets worth Rs 302 crore."

He said the focus had been to develop a robust network backbone, to cater to the growing market demand, in addition to the development of 'last-mile' connectivity to consumers.

On the plan for laying a network in 11 clusters of the suburbs, to provide power to low-end customers, Sethi said steady network expansion was on. In four of the 11 clusters, the company had laid the required network.

Further Sethi informed that as per the latest Supreme Court order, Tata Power can supply to consumers in BEST (BrihanMumbai Electric Supply & Transport) area only on its wire. The company will have to lay its own network to supply power in BEST area comprising Colaba in south Mumbai up to Sion and Mahim in north central Mumbai..

According to Sethi, laying of network in a congested city like Mumbai is a great challenge for any utility. ''For last 2 years (FY 2012-13 and FY 2013-14), the available time for laying of network was a mere 100 days.

The rest of the period remained unproductive in terms of actual physical work, on account of the time taken by Municipal Corporation of Greater Mumbai (MCGM) and other agencies for granting permissions and 4 months period of monsoon in a calendar year, during which cable laying activity is not permitted,'' he said.