State Electricity Board losses mount

India’s government is being pressed to implement reforms to the energy sector to encourage private participation after the latest Economic Survey found that State electricity boards (SEBs) are expected to deliver a minus 28% rate of return.

Commercial losses of SEBs are expected to cross Rs22,000 crore ($51 million) in 2005 – 2006 and though transmission and distribution losses have reduced to 32.54% in 2002-2003 from 33.98% in 2001-2002, the losses continue to mount. The total commercial losses of SEBs, excluding subsidies in 2004-2005, are Rs 20,715 crore. While direct transfers from State governments to SEBs in the same period stood at Rs 9,825 crore ($22 million).