Ranchi, Feb. 13: A state power board that is knee deep in debt is faced with the unenviable task of paying off liabilities before it can go ahead with the complex task of unbundling the entity.
During a review meeting convened by governor's adviser Madhukar Gupta today, it was observed that the Jharkhand State Electricity Board's (JSEB) accumulated losses exceed Rs 6,800 crore.
The power utility and the state administration are trying to evolve effective steps for unbundling JSEB into separate firms ' for generation, transmission and distribution ' with the help of Power Finance Corporation Limited (PFC).
"The unbundling process cannot take off in the real sense of the term unless accounts are settled. The company owes Rs 400 crore to Coal India Limited, Rs 250 crore to the railways, Rs 280 crore to banks, etc. The adviser, too, felt that the state administration would have to pay off these amounts if at all it was serious about reviving JSEB," said a senior officer who took part in the meeting.
Insiders said PFC made presentations before Gupta, but its officials were pushed to tight corners when asked how the losses will be bridged.
At this, chief secretary S.K. Choudhary reportedly suggested that PFC and JSEB should hold separate meetings to discuss viable alternatives.
The state is keen on unbundling JSEB within three months. While the board will remain a holding company, its subsidiaries will independently handle generation, transmission and distribution.
"We will hold more such meetings in the coming days. Amicable solutions will be worked out soon," said energy department special secretary Vikram Singh Gaur.
The state has appointed PFC as consultant to take JSEB through the process of unbundling the board. PFC has made several presentations in this regard.
Today's presentation by PFC, too, was another initiative on this front. JSEB chairman S.N. Verma and executives of PFC also attended the review meeting.
According to plans, JSEB will be split into one holding firm and three subsidiaries.
The power board has also promised zero liability start for the new entities after the unbundling. But at present, it has no clear answer on how to pay off its debts.