After holding talks with the state power ministers, secretaries, state electricity boards chairmen and experts, the power ministry will prepare a fresh draft to be taken for the cabinet's approval, he said.

Kumarmangalam said that power majors National Thermal Power Corporation and National Hydel Power Corporation have chosen SBI Caps and ICICI as consultants to advise them in their efforts at financial re-engineering as well as raising funds to the tune of Rs 11 lakh crore for investment in the power sector over the next seven to eight years.

"Both NTPC and NHPC have, on the advise of union power ministry, appointed the two consultants for their financial restructuring," he said.Talking about the Rs 23,000 crore of bad debts weighing down the state electricity boards, Kumarmangalam said that mere reforms without concentrating on revenue streams would not help them and that a group of ministers would soon take up the issue of securitisation of these debts.

The power minister pointed out that some minor changes were on the anvil in the already announced mega power policy as it had been found that independent power producers were well-off even without duty exemption and the resulting differential, if any, would amount to only six to seven paise per unit.

Meanwhile, the PFC chairman Udesh Kohli said that the PFC would earmark about Rs 5,000 crore for providing assistance to the various SEBs for carrying out power reforms.Kohli told The Financial Express that the concept of having commercially viable and self sustainable power distribution entities would remain a distant dream unless remedial steps including those aimed at restructuring the distribution sector are taken. According to him, there is no alternative but to introduce a competitive and transparent market in the long run.