Cabinet Clears Proposal To Increase Equity Investment Threshold of Powergrid
The CCEA has approved enhanced delegation to Powergrid under the guidelines dated February 4, 2010, of the Department of Public Enterprises (DPE) on delegation of powers applicable to ‘Maharatna’ Central Public Sector Enterprise (CPSE),” Information and broadcasting minister Ashwini Vaishnaw told reporters after the cabinet meeting
New Delhi: In a move to bid for capital-intensive transmission projects in the country, the Union Cabinet on Tuesday cleared a proposal to increase the equity investment threshold of public sector enterprise Powergrid from Rs 5,000 crore to Rs 7,500 crore per subsidiary.
The approval will enable Powergrid to expand its investment in its core business and support the evacuation of renewable energy capacity, helping achieve the target of 500 GW from non-fossil-based sources. The Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, took its first decision at PM’s new office, Seva Teerth.
“The CCEA has approved enhanced delegation to Powergrid under the guidelines dated February 4, 2010, of the Department of Public Enterprises (DPE) on delegation of powers applicable to ‘Maharatna’ Central Public Sector Enterprise (CPSE),” Information and broadcasting minister Ashwini Vaishnaw told reporters after the cabinet meeting.
“The approval enhances the permissible equity investment limit of Powergrid from the current threshold of Rs 5,000 crore per subsidiary to Rs 7,500 crore per subsidiary, while retaining the existing cap of 15 per cent of the company's net worth,” the minister said.
As per the government, the CPSE can now participate in the bids for capital-intensive transmission projects, such as ultra high voltage alternating current (UHVAC) and high voltage direct current (HVDC) transmission networks.
“Additionally, it will broaden competition in tariff-based competitive bidding (TBCB) for selection of bidders for critical transmission projects, thus ensuring better price discovery, which will ultimately lead to the availability of affordable and clean energy for consumers,” the government said in a statement.
