SHILLONG: The Meghalaya Government has decided to set up a corpus fund to be made available to Meghalaya Energy Corporation Limited (MeECL) and its three subsidiary units- transmission, distribution and generation – to meet their short term requirements and to help them initiate a ‘smart business plan’ that will provide a face-lift to the cash-starved Corporation.
“The creation of this corpus fund will give an access to the MeECL to easy fund for any business initiative which it can take up to make good profit. The profit would then be used by the Corporation for a turnaround,” Chief Minister Mukul Sangma said after a Cabinet meeting here on Friday.
The Chief Minister said the Power Department had been directed to create a separate entity to manage this corpus fund to enable the Corporation to run certain smart business plans wherever these were found and ensure a financial turnaround.
The Chief Minister was of the view that time was ripe for MeECL and its subsidiaries to perform and also adopt certain measures which should be in conformity with the best business and corporate practices. “This would ensure a turnaround and subsequent sustainability of MeECL and its subsidiaries in their respective fields of responsibilities,” Sangma said.
“The three subsidiaries under MeECL should now learn how to stand on their own. In corporate terms they must be able to have the best business and financial management plans so they would be capable of sustaining on their own,” he said.
“We have asked the MeECL and their subsidiaries to come up with a report of their complete business plans and financial management plans and all other activities which are linked to their respective sources of revenue generation and their overhead expenditures,” he added.
Urging the MeECL to ensure that other Central sector power utilities do not cut off power supplies to it altogether, Sangma advised the MeECL functionaries to complete necessary auditing exercises to become eligible for additional financial support programmes of the Centre.
“Completion of auditing will make the MeECL eligible to the benefit of the Financial Restructuring Plan,” he said, adding, “The State Government would pass on to the MeECL certain other benefits once the formalities are completed.
Sangma also stressed on the need for the State to have a proper balance between hydro and thermal generation capacities, similar to what other states were contemplating. “When you are dependent on hydro power, invariably supplies would be affected when there is a lean and dry season. There is need to have an ideal mix between hydro and other sources,” Sangma said while recalling that MeECL had displayed laxity when they had been asked to develop a thermal plant, despite indications on fund allocation being provided to them two years ago.
He also advised the State Power department to form a separate entity for generation of power from thermal sources with a sense of urgency so that a supplementary source of power can be made available to the State.
“The Power department has also been asked to immediately prepare proposals for generation of additional power from bio-mass and solar energy,” the Chief Minister said.
“Direction has been given for appointments of appropriate consultants. The Government will be providing necessary support and is also adopting an appropriate policy to ensure that stand alone projects are set up to cater to the needs of difficult areas which otherwise would need long transmission lines which are difficult to manage,” he said.
“These could withdraw from the main grid and make power available to selected areas. This will also reduce the usual transmission and distribution losses,” he added.