The Centre, on Tuesday, announced that it is going to bring a model State Electricity Distribution Responsibility Bill within a year to hold state discoms accountable for implementing the introduced power reforms under the newly approved debt recast financial package approved by the States.

“The Ministry of Power would bring out a draft State Electricity Distribution Responsibility bill after due inter-ministerial consultation within a period of 12 months from the approval of the scheme," Power Minister Veerappa Moily told journalists here.

After the notification of the debt restructuring package, which would be done shortly, the States would enact the legislation within 12 months from the date of circulation of model legislation to mandate compliance of the provisions of the financial restructuring package, he said. Those states who fail to comply with the conditions laid down in the debt recast package would not be able to avail of the package. “The discoms and the State Electricity Regulatory Commissions (SERC) would be required to notify new power tariffs on the first day of April every year,” he added.

Mr. Moily said in reply to a question that tariffs would have to be rationalised by the discoms in accordance with the requirements of the new package. Asked if this would lead to hike in tariffs across various states, he said 21 states have already gone for tariff hikes. “Some sections will have to bear the burden. But subsidies for the farmers and other related sections will continue,” he remarked.

The Cabinet Committee on Economic Affairs approved the scheme for financial restructuring of state distribution companies (Discoms) on Monday. The scheme contains various measures required to be taken by state discoms and state governments for achieving the financial turnaround of the discoms by restructuring their debt. “The accumulated losses of the state discoms are estimated to be about Rs.1.9 lakh crore as on March 31, 2011 and Rs.2.46 lakh crore as on March 31, 2012,” he added.

So far only seven states, Rajasthan, Uttar Pradesh, Madhya Pradesh, Andhra Pradesh, Punjab, Haryana and Tamil Nadu have come on board, Mr. Moily said.

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