Uttar Pradesh is looking to privatise two of its four power distribution companies, a state government tender showed, as the country’s most populous state grapples with power losses and a lack of sufficient transmission infrastructure.

It is inviting private companies to form partnerships with or privatise state-owned Dakshinanchal Vidyut Vitran Nigam and Purvanchal Vidyut Vitran Nigam, per the tender dated January 12.

A majority of state power distribution companies in India are suffering losses due to older power transmission systems and frequent power losses, prompting the government to bring in private players.

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Dakshinanchal Vidyut Vitran Nigam and Purvanchal Vidyut Vitran Nigam are each responsible for power distribution in 21 districts of Uttar Pradesh.

Last year, the power minister asked states to identify and list their profit-making power utilities on the stock exchange to meet increasing investment demand in the power sector as well as to improve the transmission system to add more renewable capacity.

New Delhi and Odisha already have private-public power distribution partnerships in place.

Tata Power is a major private player in the power distribution space, operating in Odisha as well as major cities like Delhi and Mumbai.