Power companies’ shares rally as PM Modi vows to delicense distribution

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NEW DELHI | MUMBAI: The government will free the electricity distribution sector from licensing, Prime Minister Narendra Modi said on Thursday when shares of several power companies rallied.

Shares of Bharat Heavy Electrical Ltd closed 7.3% higher on the BSE on Thursday while Torrent Power scrip ended the day 8% up while government officials held a series of meetings with industry captains and associations on the proposed legislative amendments to delicense power distribution and other announcements made in the Union budget.

Adani Transmission,

, , , CESC and Tata Power, too, saw a surge in their share prices. So did NTPC, Power Grid Corp, and NHPC.

“Throughout the country, we are taking a look at electricity supply and the distribution network to allay the problems with them,” Modi told senior executives from the power sector on a virtual platform. “For this, a discom-related policy and regulatory framework is in the works,” he said.

The government looks keen to table the Electricity Act Amendment Bill in the Budget session of Parliament to enable electricity connection portability for consumers.

Modi addressed industry executives during a virtual consultation power and renewable energy minister R K Singh held with promoters and top executives of companies with large presence in power distribution, including Reliance Infrastructure’s Anil Ambani, Torrent Group’s Jinal Mehta, Tata Power managing director Praveer Sinha,

managing director Anil Sardana, CESC chief executive officer Debashish Banerjee and Association of Power Producers director general Ashok Khurana.

Singh, along with other senior officials, held several meetings with stakeholders on budget announcements. A senior government official said the distribution delicensing proposal has been welcomed by all the stakeholders.

The government is taking steps to ensure level-playing field for state-owned electricity distribution companies and dissuade cherry picking of supply areas by private companies when the sector is delicensed, power secretary Alok Kumar told ET during his first media interaction on Thursday.

All states have welcomed the Centre’s proposal to delicense power distribution sector for giving choice of suppliers to consumers, said Kumar who, along with other senior ministry officials, had held four zone-wise meetings with additional chief secretaries and principal energy secretaries of states on Wednesday.

Meanwhile, speaking to industry executives, Modi said the proposed performance-linked incentive (PLI) scheme for high-efficiency solar photovoltaic modules will lead to investments of more than Rs 14,000 crore to create manufacturing capacity of 10,000 MW.





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