The pending electricity bills of the government departments are one of the major concerns of the private companies, which are willing to become franchisee for distribution of power in Uttar Pradesh.

The investors have also found the rider of reducing line losses from 47 per cent at present to 15 per cent in five years’ time, impractical. Besides, they sounded apprehensive of meeting the power demand in a state, which is suffering from acute power shortage.

Over a dozen companies participating in a pre-bid conference held on Monday raised these issues before the authorities of UP Power Corporation Ltd. The companies included Tata, Torrent, Reliance, NOIDA Power Company, HCL, AtoZ Power Tech, Crompton Greaves, Thapar Group, Global Engine and many more.

The pre-bid conference was organised to get the feedback from the companies who were interested in UP government’s Public Private Partnership (PPP) project for distribution of power through franchisee system. Raising the issue of pending bills —especially in Kanpur and Agra — for which the Torrent Power has shown interest, company Director Murli Ranganathan said it is the government departments that consume about 12 per cent of the total electricity.

“Payment by the government department depends on the annual budget, of which the previous records are not very encouraging. How will the government ensure timely payments?” asked Ranganathan.

Director (Finance) UPPCL SK Agarwal, however, came up with a candid reply: “Disconnect the supply, if someone is not paying, irrespective of his status. Our hands are tied but you can.”

Agarwal explained that it is only the Jal Sansthan, whose connection, if snapped, can cause inconvenience to public.

The companies were also apprehensive of a condition that restricts them from increasing the tariff. “There is a shortage of power in the state, for which the companies will have to purchase power from the open market at a high price,” said Sharad Kumar, General Manager (power services) Jamshedpur Utilities and Services Company Ltd (JUSCO) — a Tata enterprise.

The companies also raised the issue of a rider of the UP government to reduce the line losses from 47 per cent at present to 15 per cent in the next five years, which they have termed a tall order.