All states on board for discom reform scheme
States are in consensus with the Centre for the ~3-trillion power distribution reform scheme launched this year, said R K Singh, union minister for power, new and renewable energy.
Singh, in a virtual meeting with state power ministers on Thursday, said the states have been given a two-month extension to submit their loss reduction plan by December 2021.
“Almost all states have said that they will reduce their losses and draft a plan for it. Most of them will be able to submit their plan by October,” said Singh, adding the ministry will handhold states in preparing their lossreduction plans.
The new “Reforms-based and Results-linked, Revamped Distribution Sector Scheme” seeks to improve the operational efficiencies and financial sustainability of all discoms/power departments (excluding private sector discoms) by providing conditional financial assistance for strengthening of supply infrastructure.
The assistance will be based on meeting pre-qualifying criteria as well as upon achievement of basic minimum benchmarks by the discom, evaluated on the basis of agreed evaluation framework tied to financial improvements. Implementation of the scheme would be based on the action plan worked out for each state, this paper had reported earlier. An annual appraisal of discoms will be done to check their progress and funding will be disbursed accordingly.
The scheme will have an outlay of ~3,03,758 crore with an estimated gross budgetary support from the central government of ~97,631 crore. All the existing power sector reform schemes, namely DDUGJY, IPDS, and PMKUSUM, would be subsumed into this umbrella programme. Singh said till yet ~2 trillion has already been given to the states under these schemes.
“The two key focuses of the reform plan are strengthening the power supply system and modernising it. I want every discom to have an IT wing,” he said.
Under the modernisation plan, supervisory control and data acquisition, demand management system, digital systems, smart prepaid meters, etc will need to be installed.
Singh said states are required to prepare their plans based on thorough system study, assessing the demand and the weaknesses in their power systems.
The programme has been designed as a bottom-up scheme and the discoms/states are empowered to prepare their own detailed project reports (DPRS) based on their need assessments prioritising the loss reduction works, the minister said.
During the meeting, Singh said states were also encouraged to avail benefits of the PM-KUSUM scheme for solarisation of agricultural feeders.
State-owned lenders Rural Electrification Corporation and Power Finance Corporation have been nominated as nodal agencies for facilitating implementation of the scheme.
State-owned discoms across the country are financially and operationally beleaguered despite four reform schemes in the last 15 years.
Almost all states have said that they will reduce their losses and draft a plan for it. Most of them will be able to submit their plan by October R K SINGH Union minister for power