James optimist of MeECL’s capability to manage its distribution circles

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Amidst the impasses over leasing out of power distribution circles to REC, Power Minister James K Sangma has expressed confidence that the Meghalaya Energy Corporation Limited (MeECL) is capable of managing its distribution circles and creating a turnaround in the near future.

Addressing media persons after a meeting with Chief Minister Conrad K Sangma on Tuesday, James said the power department is totally opposed to the idea of distribution franchisee (DF) as MeECL would stand to lose in the long run.

“I have met the chief minister and I have once again stressed upon and urged upon him to look at the fact that the MeECL is very much capable…of managing these distribution circles and we do not need to give to the DF,” he said.

This meeting came one day ahead of the crucial sitting of the state Cabinet to take a final call on whether to give a 100 percent state guarantee for the Rs 1,345 loan or hand over the management of some of the distribution circles to the Rural Electrification Corporation Power Distribution Company (REC PDCL).

James said the power department has made it very clear right from the beginning that 100 percent budgetary provision and state guarantee should be given to MeECL by the state government.

He informed a delegation of the MeECL employees led by its Chairman-cum-Managing Director Arunkumar Kembhavi requested his intervention to ensure that outsourcing of the distribution circles is avoided.

“The chief minister has assured me that he will definitely look into this matter and before we come to a decision tomorrow, we will take up this matter in the meeting and discuss with our cabinet colleagues,” the minister said.

Also expressing optimism that the MeECL will see an active turnaround in the future, James said, “I have assured the chief minister that the MeECL will be moving in that direction as one united team to achieve the goal of turning around the MeECL.”

When asked, the minister claimed that the turnaround is something that is already in the process. He said there are several EAPs, ADB funded projects, World Bank-funded projects, JICA funded projects, centrally sponsored schemes by the government of India which are already in the stage of implementation and these schemes have been put into use for distribution sector system improvement, for improvement in our generation.

“So all these kinds of interventions which have been put in place are the turn around that we are talking about – the cogs in the wheel are already in motion. We need time as no turnaround can take place immediately. This sort of motion will bear results and we hope that it will happen soon and that is why I have been assured by the engineers of MeECL, by the CMD that they will be able to achieve this turnaround as it is already in motion,” he added.

On the question being put forth by the finance department as to how long the state government would continue to bail out the MeECL, James however said that the power department is very confident that the MeECL is capable of ensuring a turnaround.

“We understand the point of view of the finance department also that this has been a situation which keeps coming up wherein certain problems come up and Discom has to turn to the state government for support. I hope it does not come to that and I hope we are given this chance, the Discom is given a chance to prove themselves and I am very sure certain conditions may be put and I have discussed this matters with the engineers of the MeECL and they are assuring us of complete support so that we move in one direction to work for the turn around of MeECL,” he said.

Meanwhile, the CMD of MeECL said the additional condition of 25 percent distribution franchisee was put by the REC and PFC as they felt that the MeECL, whose annual revenue is Rs 900 crore, will not be able to repay the Rs 1,345 crore loan.

Should it take place, Meghalaya will be the first state to have given the distribution circles as distribution franchisee under the Atma Nirbhar loan and no other states have been imposed with such conditions by the union government, he added.