Bhubaneswar: Tata Power is all set acquired Cesu, Odisha’s largest power distribution company (discom). The Odisha Electricity Regulatory Commission (Oerc) has handed over the letter of intent to Tata Power for the purpose.

For running the discom of 25 lakh consumers, a special purpose vehicle will be formed where in the Tata Power will have 51% stakes and the Odisha government 49%. The license to the Tata Power will be given for 25 years.

Cesu comprising of five circles covering 9 districts of central Odisha region was under the administration of Cesu after US utility giant AES abandoned it in 2001. The attempt to hand over the distribution business to private company since then had failed as there was no response to the tenders. Last time, the tender had to be canceled as there was a single bidder.

However, Oerc engaged Price Water House Cooper for the privatization of Cesu. In 2016, Oerc got two bids from Tata Power and IPCL-Fedco in response to its tender and it selected the former for the partnership with the State government in the SPV.

As on March 31, 2018, Cesu had reported 31.72% T&D loss and 34.07% AT & T loss. The target is reduce the AT &T loss to 22.57%. Out of the 25 lakh consumers of Cesu, 90% are domestic, 7% industrial, 1% irrigation and 2% consumers.