The Central Electricity Authority (CEA) of India has proposed a monetisation strategy for public sector transmission assets, outlined in a concept note to the Forum of Regulators.
This initiative is part of the Acquire, Operate, Maintain, and Transfer (AOMT) model established by the Power Ministry in 2022, which facilitates the temporary transfer of public assets to private firms to improve efficiency and financial outcomes. State electricity regulators are expected to implement this framework, focusing on establishing a clear and stable tariff structure to enhance investor confidence.
The proposal addresses concerns such as revenue certainty and payment security, emphasizing the need for a systematic identification and monetisation process, including the establishment of Special Purpose Vehicles (SPVs) for assets subjected to the Regulated Tariff Mechanism (RTM).
Transparency will be ensured through the engagement of technical consultants and independent valuers, while comprehensive legal documentation will support the transfer agreements. One significant challenge identified is the predictability of cash flow from monetised assets, especially those operating under Real Time Market (RTM) norms.
Source – sarkaritel.com
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