Interview with Ayush Tiwari: Understanding the challenges in UPPCL’s privatisation

Ayush Tiwari is Manager at BSES, where he oversees operational and process management across distribution grids in Delhi. Before joining BSES, he held key roles at Torrent Power, REC Power Distribution Company, and Watchdog Security, where he led large-scale infrastructure and high-voltage distribution projects under government schemes like PMDP and UDAY. With a career spanning power distribution, project management, and technical design, he brings a strong understanding of India’s grid operations and energy transition challenges.

In this interview with Power Peak Digest, he shares his insights on the ongoing UPPCL privatisation, highlighting the political and regulatory dynamics shaping the process. He discusses the importance of regulatory oversight by UPERC (Uttar Pradesh Electricity Regulatory Commission), workforce transition planning, and measures to build investor confidence. He also outlines lessons for other states from Uttar Pradesh’s approach and the key milestones that will indicate real progress in the coming months.

What are the key factors driving the UPPCL privatisation at this stage?

Political will and a state-level push to attract private capital and operational expertise to improve distribution performance and reduce fiscal burden are the primary drivers. The UP government has signalled its intent to move ahead with privatisation across multiple districts and is now fast-tracking decisions after earlier delays.

At the national level, policy efforts to open up retail power and make distribution more market-oriented (draft reforms proposed in 2025) strengthen the business case for private players to expand into large states like UP. That national policy momentum is reinforcing state-level action.

What are the main regulatory or financial challenges that could slow the process?

UPERC has raised detailed queries about asset valuation and mismatches between reported assets and loans. These issues directly affect tariff impacts and buyer liability. Unless reconciled, they raise investor and regulator confidence issues and can delay approvals. 

The overall timeline also depends on UPPCL responding to UPERC’s queries and securing clearances for the transaction structure and related power purchase agreements or arrangements. The process has been delayed while these outstanding items are resolved. In addition, public interest litigations, political opposition, and sustained employee agitation continue to create legal and reputational uncertainty that can affect bidder confidence or stall implementation.

How important is UPERC’s role in shaping the final framework?

Extremely important. UPERC’s role is not merely procedural. It acts on tariff, asset valuation, and cost-reflective measures that determine how liabilities and consumer impacts are apportioned. UPERC’s observations on debt-equity, ARR, and specific accounting entries materially shape bidder risk and the final deal terms. Until the regulator’s queries are answered, the transaction cannot be considered secure from a pricing or consumer-protection perspective.

You mentioned human resource transition and union resistance. What measures can help ensure a fair workforce transition?

Practical measures that have precedent in other discom privatisations can help reduce friction.

Transparent social compact: A written Transition Agreement covering retention windows, pension or benefit continuity, commutation options, and clear severance or placement clauses.

Tripartite consultations: Early, structured talks between the state, the incoming operators, and unions (with regulator oversight) to build trust and co-design workforce transition timelines.

Phased staffing and redeployment: Retain core field operations staff during the initial months and offer retraining, absorb-and-hire windows for the new operator, and redeployment to state utilities or related organisations where feasible.

Independent verification and grievance redressal: Third-party audits of HR commitments and a rapid grievance mechanism reduce the chances of prolonged strikes or litigation.

These measures help reduce political friction and continuity risk for supply. The urgency is evident given ongoing, large-scale employee protests in UP, which have already continued for months.

What level of interest do you foresee from private players such as Tata Power, Adani Electricity, and Torrent Power?

Interest from large, vertically integrated players is real and active. Several large groups, including Adani, Tata Power, CESC, and others, have been reported as eyeing stakes in UP discoms. These companies have the balance-sheet depth and distribution experience to participate, especially where scale and regulatory clarity exist. Expect robust interest at the RfP and bid stage from major national distribution players and possibly some consortium bids.

That said, final bidder appetite and pricing will depend on how the state addresses accounting and loan issues, the extent of contingent liabilities, and the guarantees or transition support offered by the state. All these factors materially affect valuation and risk allocation.

What lessons can other state utilities take from UPPCL’s approach?

Proactively aligning asset valuations and tariff implications with the regulator helps avoid late-stage stoppages. UPERC’s scrutiny shows the cost of not doing this early and highlights the importance of engaging with the regulator from the start.

The intensity and duration of employee protests in Uttar Pradesh underline the need for early and credible workforce transition planning and communication. Transparent stakeholder management can reduce uncertainty and resistance during the privatisation process.

A clear allocation of historical liabilities, deep due diligence, and properly scoped transition support, including IT, metering, and operations and maintenance contracts, help reduce renegotiation risk and delivery delays.

It is also important to expect and plan for litigation or public interest litigations. A defensible, document-backed process shortens court proceedings and helps preserve investor confidence.

Finally, what milestones should we watch for over the next few months to gauge real progress?

The key milestones to watch in the coming months will indicate how the UPPCL privatisation process is progressing. UPPCL’s formal replies to UPERC’s queries and regulator filings will show whether the major accounting and regulatory issues are being resolved. Recent reporting suggests that UPPCL intends to submit the pending replies soon to accelerate the process.

UPERC’s rulings and clarifications on asset valuation and tariff treatment will be critical because these decisions directly affect how bidder risk is allocated. The publication of the Request for Proposal (RfP) and bid timelines, along with pre-bid conference dates, will also be important markers. Issuing an RfP with concrete timelines is the clearest signal of operational progress toward privatisation. Some informal timelines suggest bid windows around late 2025 or early 2026, though official notices will confirm this.

Another milestone will be major bidder expressions of interest or the formation of consortia. Announcements or filings by companies such as Tata Power, Adani, Torrent, or others will indicate market appetite and likely pricing dynamics. Legal or political developments, including court orders or cabinet decisions, can also accelerate or delay progress. The recent dismissal of a public interest litigation in the Allahabad High Court is one example of how the legal process is evolving.