We aim to service over 1 million consumers in Mumbai by 2018-19: Anil Sardana

Interview with MD, Tata Power

Tata Power last week received a distribution licence up to August 2039 to supply electricity in the city of Mumbai and some of its suburban areas. Managing Director Anil Sardana talks to Sanjay Jog on their plans. Edited excerpts:

How will Tata Power ensure fulfilment of the conditions laid down by Maharashtra Electricity Regulatory Commission while granting the distribution licence up to 2039?

It has asked us for a roll-out plan to acquire a balanced set of consumers in an economical manner. We have a demonstrated capability to do so, balancing the demand of consumers and competitive pressure, and within the framework approved by the Commission. We’ll be rolling out a modern network expeditiously to increase network availability to service more than a million consumers by 2018-19.

What are the challenges?

The idea is to provide a competitive alternative to customers. The environmental impact and the congested infrastructure in Mumbai would be kept in mind. We’ll use innovative commercial and technology models to overcome the constraints and expand capability.

The company in its multi-year tariff (MYT) application has projected the power purchase cost to increase by 31 per cent. How do you expect to remain competitive?

The cost increase estimated is to be read in comparison to those in the sector. The company will continue to provide cheaper power to low-end consumers during the MYT period. We’re pursuing steps for competitive input power for the next MYT period, too.

How do you propose to bridge the gap between revenue realisation and average cost of supply?

The company does not have any unrecovered fuel adjustment component for the first seven months of the year. This has been achieved by lowering the cost of power procurement, by sourcing competitive power. We’ll continue with such initiatives.

What is your view on separation of the wire and supply business?

This is a matter of the amendment of the Electricity Act, 2003, and under discussion at various forums. The company is supportive of such a move and has suggested a comprehensive framework in which this can be achieved and implemented successfully.

How do you plan to increase your presence in the 0-300 units category?

We’ve shown in recent years that acquiring low-end consumers is a focus and will continue to do so through network expansion and other means. Earlier, we couldn’t manage entire societies and areas to convert fully  because of restrictions cast by previous orders. Now that we can acquire all customers of a society or an area, we can expeditiously convert a whole set of customers in one go on our network.

What is your Vision 2020?

We aim to distribute 4,000 Mw by 2022 in our various distribution areas across the country and also through decentralised distribution and generation ventures. Currently, Tata Power has a distribution licence in Mumbai and Delhi. We will tap the opportunities in power distribution as and when it comes in other parts of the country.