BusinessIndia

Tata Power gets Letter of Intent for acquisition of CESU Power Distribution in Odisha

Mumbai, Dec 23 (GCBusiness) The Odisha Electricity Regulatory Commission (OERC) on Monday awarded the Letter of Intent (LOI) to The Tata Power Company Limited informing the Company’s selection as the successful bidder to own the licence for the distribution and retail supply of electricity in Odisha’s five circles, together constituting Central Electricity Supply Utility of Odisha (CESU).

The five electrical cirlces constituting CESU are the areas of Bhubaneswar (Electrical Circle – I and II), Cuttack, Paradip and Dhenkanal. The license is being offered for 25 years initially. Tata power said in a filing with BSE.
CESU is spread over 30000 Sq km with population of over 1.4 Crore and consumer base of 2.5 million. The average demand of CESU is around 1,300MW with the annual input energy of 8,400MUs (FY 2018).

Currently, Tata Power has total consumer base of 2.5 million across Mumbai, Delhi and Ajmer and with acquisition of CESU, its consumer base would double and touch 5 million consumers.

The proposed sale of CESU to Tata Power will be through the formation of a special purpose vehicle entity. Tata Power has been informed that Government of Odisha will own 49% equity stake in the proposed SPV and Tata Power will hold 51% equity with their management.

“Tata Power has several successful public-private partnerships in generation, transmission & distribution in the country. Recently, our focus has been on increasing the Company’s existing footprint in distribution of electricity through Public-Private-Partnerships (PPP) with discoms. This tie up with CESU is the latest such partnership in the distribution business,” said Mr Praveer Sinha, CEO & MD, Tata Power.

“We hope to transform Orissa distribution system with 24 x7 reliable power and unmatched customer services with extensive social engagement using our existing experience in distribution of electricity in Delhi, Mumbai and Ajmer,” said Mr Sanjay Banga-President-T &D, Tata Power

Source
Via UNI-India

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