Power Sector Reforms Drive Odisha’s Economic Growth; Distribution Model Sets Up New Standards

Bhubaneswar: Odisha, which has of late emerged as one of the most favourite investment destinations for manufacturing and service sector players, seems to be hugely benefiting from the sweeping power sector reforms. Consistent supply of quality power to industrial units is driving fast the state’s economic growth.

Odisha has been recording steady increase in its growth in recent years. The Gross State Domestic Product (GSDP) of Odisha for 2023-24 (at current prices) is projected to be Rs 8.65 lakh crore, amounting to growth of 12.9 per cent over 2022-23. The industries sector has the highest share in the GSVA (Gross State Value Added). Its share was estimated at 41.3 per cent with growth at 6.1 per cent in 2022-23.

While Odisha's earlier attempts at privatisation of the power sector had faced challenges, the current partnership with Tata Power in the segment, has yielded promising results. With 9 million customers spanning across the state, having large rural areas to cover, the Tata Power-led Odisha distribution companies (discoms) have shown remarkable results in a relatively short time.

This success is underscored by the improved consumer service ratings of all four Odisha Discoms such as TPCODL, TPSODL, TPNODL, TPWODL reflecting the positive impact of the State's reform initiatives.

The partnership with Tata Power, one of the oldest and well-established integrated players in the sector, has been instrumental in driving transformation, even amidst adversities such as Cyclone Yaas. Leveraging technology and a customer-centric approach, Tata Power has set new benchmarks in service delivery and performance, mirroring its past success in Delhi's power distribution landscape.

“With several milestones crossed in the past three years, including an increase in new connections (10 lakh new connections), job creation for fifty thousand people, industrial linkages to over five thousand facilities, and a reduction of 10 per cent in Aggregate Technical & Commercial (AT&C) losses, Odisha's power distribution sector is witnessing a significant turnaround.

This success story not only augurs well for the state's industrial ambitions but also serves as a potential model for other States grappling with distribution challenges.

Looking ahead, the passage of the Electricity Act, post-general elections is poised to unlock further opportunities for the PPP model, paving the way for transformative changes in the distribution sector nationwide.

“Odisha's privatisation success story stands as a testament to the power of strategic partnerships and innovative governance, heralding a new era of growth and development in the sector. Odisha has the potential to become a model for other states to emulate and help transform the ailing distribution sector by joining hands with the private players with proven credentials,” said a top government official in the state power ministry

To support its vision to become a preferred investment destination, Odisha has prioritised infrastructure development, leveraging its rich mineral deposits and skilled labor force, and is further attracting investment by showcasing its immense potential at events like Invest Odisha and Make in Odisha. This approach has positioned the State as a beacon of industrial reform, earning accolades for its business-friendly environment.

One of the standout achievements in Odisha's journey is its pioneering Public-Private Partnership (PPP) model in the power distribution sector. This model has garnered attention from global think tanks, including the Centre for Strategic & International Studies (CSIS), highlighting how technology and enhancing operational efficiency can bring quality service.