| BSES chairman and managing director Anil Ambani in Mumbai on Monday. (PTI)
Mumbai, June 9: BSES, which renamed itself Reliance Energy today, will use the gas reserves found by Reliance Industries in the Krishna-Godavari basin in Andhra Pradesh to fire its power generating stations.
“Reliance and BSES, working together, can create a win-win situation to utilise these reserves for the generation of competitive, quality power,” BSES chairman and managing director Anil Ambani told shareholders in his first appearance at the company’s AGM.
The firm generates 885 MW of coal-fired power, while it distributes 5000 MW procured from other utilities.
Ambani brought a whiff of freshness to the AGM with his easy banter, repartees and in the way he handled shareholders; he even gave on-the-spot detailed answers without the help of notes, a feat that drew him applause for a great debut as the new chief. He had last chaired an extra-ordinary general meeting.
Addressing shareholders as his mother, Kokilaben, and wife Tina witnessed the proceedings from the front row, Ambani spoke about his father Dhirubhai’s dream to make power available at cheaper rates by 2010.
Asked why BSES’ subsidiaries were being spun off, Ambani said it was done to rein in the company’s financial liabilities. The burden would be limited to its equity exposure in Orissa and Delhi distribution companies.
Reliance Industries even cut its stake in BSES from over 50 per cent to 49.5 per cent to maintain “an arms length relationship” between the two companies. “We are major shareholders of BSES. In future, the power utility will procure gas as the main feedstock from RIL. We desire no other financial linkages,” Ambani said.
He talked about how the coming years will see a rapid changes in the way energy is procured and distributed. “The new Electricity Act gives us the freedom to trade power, both in physical terms and through derivatives. We will set up a separate company, Reliance Energy Trading, for the purpose,” he added.
Ambani voiced concerned about the transmission and distribution (T&D) loss of over 50 per cent in Delhi’s power distribution utilities, set up as joint ventures with BSES. He said a fall of 1 per cent in the losses would add Rs 50 crore to the bottom line of these entities.
Keen on Dabhol
BSES has sought Maharashtra government to use the assets of Enron’s Dabhol Power Company to generate power till the gridlock on the project is broken.