Private power firms Tata Power and Reliance Energy are working together on a study for the opening up of the power distribution sector in Maharashtra.

The study has been commissioned by the state power regulator -- the Maharashtra Electricity Regulatory Commission -- and will deal with the introduction of competition in electricity distribution as provided under the Electricity Act 2003.

The regulator has called upon the two private power firms for engaging a consultant to study the modalities involved in introducing open access.

Both Tata Power and Reliance Energy have submitted applications to the MERC for acquiring distribution licences in some of the lucrative circles in the state.

While considering the applications, the MERC will have to deal with Section 14 of the Electricity Act 2003, which provides for the grant of a second distribution licence for an area already being serviced by a utility.

This means that an applicant for a second distribution licence in Maharashtra can either apply for a licence in Mumbai or the rest of Maharashtra, since these are the only two distribution zones existing in the state.

Tata Power has applied for supplying power directly to consumers in the Navi Mumbai, Pune, Bhandup, Vashi, Lonavala and Khopoli circles in Maharashtra.

Reliance Energy has applied for supplying power to the posh south Mumbai area, Navi Mumbai, Nagpur, Pune, Aurangabad and Nasik circles in Maharashtra.

The move by the two private power utilities in the state is expected to provide stiff competition to the state-owned Maharashtra State Electricity Board.

MSEB is the sole supplier of power, with the exception of Mumbai, to consumers in Maharashtra.

This includes the Navi Mumbai, Pune, Bhandup, Vashi, Lonavala and Khopoli circles, for which Tata Power has applied.

Power Play

• The study has been commissioned by the Maharashtra Electricity Regulatory Commission.
• It will deal with the introduction of competition in electricity distribution as provided under the Electricity Act 2003.
• Reliance Energy and Tata Power have been called upon to file the terms of reference for engaging a consultant to study the various modalities involved in ushering in open access.
• Both have submitted applications to the MERC for acquiring distribution licences in some of the lucrative circles in Maharashtra.