The Tangedco, having achieved power surplus this financial year, could come out of the red in the next financial year.
In the budget estimate for the year 2017-18, Tangedco has shown a surplus of ₹2,150 crore.
Assuming the actuals don’t deviate much from the budget estimate, Tangedco would be out of the woods in terms of its financial position for the first time in 15 years. The last time Tangedco had shown revenue surplus was in 2002-03, with ₹112.57 crore.
A senior Tangedco official said that over the past two years, the power utility has witnessed a financial turnaround, with losses having drastically reduced. And with the signing of UDAY (Ujwal DISCOM Assurance Yojana) the coming financial year, it may be able to break even. The total financial loss, which was at a staggering ₹13,985 crore in 2013-14, has been reduced to ₹3,783 crore (revised estimate) in the financial year 2016-17.
“It will be a big milestone in the history of Tangedco.” Several factors have played a role in the electricity utility coming out from the financial negatives which includes renegotiation with power producers to reduce power purchase cost, improved blending of domestic coal with imported coal helping in reducing the burden in huge outgo of foreign exchange, improvement in power production and distribution infrastructure and above all going for replacement of digital meters. The installation of digital meters came as a shot in the arm for Tangedco as revenue has seen a sharp increase in the past three years.
However, the biggest financial impact is the State inking the UDAY deal.
The signing of UDAY has resulted in Tangedco being relieved of a huge liability by ₹23,000 crore out of a total of ₹30,000 crore. The liability of ₹23,000 crore would be taken over by the State government over a period of five years. A senior official of Tangedco said the interest commitment for the power utility would be reduced by almost ₹2,000 crore.
