Govt looks to implement electricity distribution franchise model to help discoms


Govt looks to implement electricity distribution franchise model to help discoms

The power ministry is looking to include a distribution franchise model under the new tariff policy, sources told CNBC-TV18 on Friday.

With financial losses amounting to about Rs 23,000 crore on state distribution companies as per ICRA report, the government believes that implementation of franchise model will help these firms become efficient at least in terms of billing and collection of electricity dues, said the sources, who did not want to be named.

In the franchise model, an area is tendered out to the highest bidder by the particular state distribution company to any private company which manages billing and collection on behalf of the discom. Read More

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