‘Uday’ Gets Discoms Back In Shape, Boosts Power Supply

‘Uday’ Gets Discoms Back In Shape, Boosts Power Supply

The Modi government’s prescription for ailing state power distribution companies is slowly putting them back in shape and reducing the duration of blackouts in the nearly two years since the treatment began.

Data presented during last week’s review of ‘Uday’, the revival plan for discoms, by the PM show major improvements in the key parameters on which health of discoms are judged.

The government approved Uday on November 5, 2015, when all state discoms were gasping under a collective debt of Rs 3.95 lakh crore. Some 90% of this debt, or Rs 3.82 lakh crore, belonged to states that were ready to swallow the pills being proposed in Uday.

Almost two years down the line, the participating states now have found relief for their debt pain by floating bonds worth Rs 2.32 lakh crore, or nearly 87% of the burden.
The next step was to regain operational strength by reducing AT&C (aggregate transmission and commercial) loss — a euphemism for power theft — through widespread metering and improve revenue through robust billing and collection. Tests have been positive on both counts, with 12 states reporting a reduction in AT&C losses and 15 states shrinking the gap between their aggregate cost of supply (ACS) and aggregate rate of realisation.

At an overall level, the ACS-ARR gap has reduced from 59 paisa per unit in 2016-2017 to about 45 paisa per unit at present. Simultaneously, the average AT&C loss for all states that have signed up for UDAY has come down to 20% this fiscal. No wonder, the average annual loss of discoms have come down from Rs 51,340 crore in fiscal 2016 to Rs 40,295 crore in 2017. So what does all this mean for average consumers? Well, longer supply hours, for one. A recent government statement said the average duration of power cuts declined 61% to 7.45 hours a month in May this year from 19.38 hours in the year-ago period.

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