Lucknow, May 2: In accordance with the Central Electricity Act, 2003 under power reform programme, Uttar Pradesh government today transformed the erstwhile UP Energy Trading company as UP Tranmission Company -- recognising it as an independent body.
Now the transmission, which was the objective of the UP Power Corporation Ltd (UPPCL), has been given to the new company while sale and purchase of power entrusted with the old company had been given to the UPPCL.
The decision to form the new company was taken in the state cabinet meeting here chaired by Chief Minister Mulayam Singh Yadav.
State Chief Secretary N C Bajpayee said changes were made in accordance with section 39 of the Central Electricity Act, 2003.
He said transfer of assets, liabilities and employees would be taken up later on as three months time would be required to complete the setting up of the new company.
In another decision, the state cabinet today approved government guarantee to UPPCL for taking a loan of Rs 786 crore from Power Finance Corporation and Rural Electrification Corporation for expansion of transmission lines under the Rural Electrification Programme.
The state government will charge only 0.25 per cent for the guarantee against its normal fee of one per cent. UPPCL has drawn up a project of Rs 905 crore for strengthening rural power tranmission lines in UP.
In another decision, the government extended the bank guarantee given to UPPCL on the loan taken from NCR Planning Board for strengthening power transmission lines in the National Capital Region (NCR).
Earlier, the time was eight years, but now it has been extended to 10 yrs.