State to join Centrally-sponsored power reforms scheme

Telangana government has expressed its willingness to join the Centrally sponsored `Revamped Distribution Sector Scheme’ - a reforms-based and results-linked scheme with an outlay of ₹3.03 lakh crore over a period of five years from 2021-22.

The scheme aims to improve quality, reliability and affordability of power supply to consumers through a financially sustainable and operationally efficient distribution sector. It is also aimed to reduce the Aggregate Technical and Commercial losses to pan-India levels of 12 to 15% and Average Cost of Supply-Average Revenue Realised gap to zero by 2024-25 by improving the operational efficiencies and financial sustainability of all power distribution companies (DISCOMS).

The decision of the State government to join the scheme was conveyed to Union Power Minister R.K. Singh by the Special Chief Secretary (Energy) of the State government Sunil Sharma at a meeting convened by the former in New Delhi on Monday.

Mr. Sharma informed the meeting that a detailed project report on joining the scheme was submitted to the government and it is likely that the Cabinet will give approval at its meeting in a fortnight.

The two DISCOMS of the State will formally join the scheme once a tripartite agreement between the Centre, State government and the DISCOMS is inked. On joining the scheme, the DISCOMS will have to fix pre-paid smart meters to all power connections, except the 26 lakh pump sets in agriculture sector.

The government had already estimated that it will cost about ₹4,000 crore for the meters in Southern Power Distribution Company Limited (SPDCL) and another ₹5,000 crore for enhancement of capacity and construction of sub-stations and creation of other basic infrastructure. The cost will be ₹2,800 crore and ₹3,500 crore respectively in NPDCL

The mandatory counter guarantee by the State government for loans borrowed by DISCOMS for implementation of the scheme was relaxed.

Sources said the gap between income and expenditure of DISCOMS was proposed to be brought down to zero from the time they join the scheme. Of the ₹3.03 lakh crore budgeted expenditure of the scheme, the Centre wanted to release an assistance of ₹97,631 crore for DISCOMS. The two DISCOMS of State will get ₹5,000 crore.

On the flip side, the scheme envisages collection of accurate figures of power consumption by consumers enjoying power subsidy. The Centre withdrew its condition to install pre-paid meters to agriculture pump sets also following protest by State governments. If the agricultural feeders were solarised under the `Kusum’ scheme, Mr. Singh suggested to the State government that its financial burden on free power to agriculture will go down.

The day time power for agriculture for nine hours could be accessed from solar energy while the requirement for the rest of the time could be met by thermal power, Mr. Singh suggested. This will save ₹4 a unit in day time and also recover investment on solar power plants over a period of five years.

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Printable version | Jun 2, 2022 12:22:50 am |