States On A Operational and Financial Recovery Under Centre’s UDAY Scheme

Uttar Pradesh has benefited from the Centre's UDAY scheme with its AT&C losses down over 1% from 34.22% to 33.03% (as per provisional figures of MoP as on Sep 5, 2016). Rajasthan's AT&C losses are down 27.32% as against 28.9% while that of Haryana and Bihar by another 0.5-0.8%.

States On A Operational and Financial Recovery Under Centre’s UDAY Scheme

Team EnergyInfraPost

With 17 States/UTs already having joined the Cente’s flagship scheme, UDAY or the Ujwal DISCOMs Assurance Yojana to clamp down the massive losses incurred by state power distribution companies, the power ministry is hopeful that all states will come on board and join the scheme in the next 45 days from now.

With the state of Maharashtra being the latest to join the UDAY scheme, there are 3-4 important states including Tamil Nadu, West Bengal and others who are yet to come on board.

“Few sates are yet to join UDAY but are in the final stages of joining the scheme and I am hopeful that West Bengal will shortly join it as assured by its chief minister…Tamil Nadu also I am old is tying up some last mile issues and is expected to join the schme,” said Union power minister, Piyush Goyal, who is also the minister of state for RE, coal and mines.

they can complete the formalities of signing the MoUs by December this year and complete the process of issuing bonds by March, 2017,” Power Ministry said in a release.

Speaking to EnergyInfraPost.com, joint secretary, union power ministry, Dr A K Verma said the states have started showing improvements on the operational parameters. As per provisional figures obtained, Uttar Pradesh has shown an improvement of over 1% in its AT&C losses (from 34.22% to 33.03%). Rajasthan’s AT&C losses are down 27.32% as against 28.9% while that of Haryana and Bihar have also fallen by another 0.5-0.8%.

Verma said provisional data showed a lower gap between states average cost of electricity supply and average cost of realisation. The gap in Uttar Pradesh distribution utilities has declined by over 65% to Rs 0.41 per unit for the year ended March 16 against Rs 1.17 per unit as on March last year. Similarly, the difference between cost of supply of electricity in Haryana reduced by half to Rs 0.23 per unit in March from Rs 0.65 per unit a year ago, he added. Others states like Rajasthan and Jharkhand have also shown considerable improvement.

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He added that till September 5th, States have already issued bonds worth Rs 1,67,533 crore under the UDAY scheme for revival of their debt-ridden discoms. Rajasthan takes the lead in issuing bonds under the Centre’s UDAY Scheme at Rs 71k crore followed by Uttar Pradesh at 44,510 crore and Haryana at Rs 25,951 crore

The Centre had launched Ujwal DISCOM Assurance Yojana (UDAY) on November 20, 2015 for the financial and operational turnaround of state-owned power distribution companies. The scheme aims to reduce interest burden, cost of power, losses in distribution and improve operational efficiency of the discoms.

Anupama Airy
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Anupama Airy

Founder and Editor at EnergyInfraPost
Independent Journalist and Energy Expert.​ (Worked with leading mainline financial and national daily for 23 years.​)​ Also, Guest Contributor with busines​sinsider.in
Currently, Writing a Book for Penguin India Titled Greased Pole:How Politics and Lobbying Stifled India’s Energy Dreams. The author can be reached on anupama.airy@gmail.com (9810661825)​
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