In a bid to streamline operations and cut costs, the Government of Delhi on Tuesday decided to merge two of its power generation firms into a single entity.

The two power generation firms to be merged are: Pragati Power Corporation Ltd (PPCL) and Indraprastha Power Generation Company Ltd (IPGCL). The decision was taken by the Cabinet presided over by Delhi Chief Minister Sheila Dikshit.

The government claimed that the step would ensure better functioning at lower costs.

Announcing the decision, Ms. Dikshit said, "We decided to merge the companies as it would streamline the process of running operations and save the additional work like filing the income tax and audits for two companies."

The Cabinet also decided to retain the latter firm's name. Therefore the joint entity will be called the Indraprastha Power Generation Company Ltd. (IPGCL).

All PPCL employees will become employees of IPGCL. Following the merger, they will therefore be governed by IPGCL's rules & policies.

The new entity will also facilitate establishment of 220 kV GIS sub-station at Rajghat, after de-commissioning of the existing Rajghat plant.