Benefits in UDAY scheme approved by GOI recently
UDAY is a path breaking reform for realizing the Hon’ble
Prime Minister’s vision of affordable and accessible 24x7 Power for All. It is
another decisive step furthering the landmark strides made in the Power sector
over the past one and a half years, with the sector witnessing a series of
historic improvements across the entire value chain, from fuel supply, to
generation, transmission and consumption. Financially stressed DISCOMs are not
able to supply adequate power at affordable rates, which hampers quality of
life and overall economic growth and development. Efforts towards 100% village
electrification, 24X7 power supply and clean energy cannot be achieved without
performing DISCOMs. Power outages also adversely affect national priorities
like “Make in India” and “Digital India”. In addition, default on bank loans by
financially stressed DISCOMs has the potential to seriously impact the banking
sector and the economy at large.
UDAY assures the rise of vibrant
and efficient DISCOMs through a permanent resolution of past as well as
potential future issues of the sector. It empowers DISCOMs with the opportunity
to break even in the next 2-3 years. This is through four initiatives (i)
Improving operational efficiencies of DISCOMs; (ii) Reduction of cost of power;
(iii) Reduction in interest cost of DISCOMs; (iv) Enforcing financial
discipline on DISCOMs through alignment with State finances. Operational
efficiency improvements like compulsory smart metering, up-gradation of
transformers, meters etc., energy efficiency measures like efficient LED bulbs,
agricultural pumps, fans & air-conditioners etc. will reduce the average
AT&C loss from around 22% to 15% and eliminate the gap between Average
Revenue Realized (ARR) & Average Cost of Supply (ACS) by 2018-19.
Reduction in cost of power would be
achieved through measures such as increased supply of cheaper domestic coal,
coal linkage rationalization, liberal coal swaps from inefficient to efficient
plants, coal price rationalization based on GCV (Gross Calorific Value), supply
of washed and crushed coal, and faster completion of transmission lines. NTPC
alone is expected to save Rs. 0.35 / unit through higher supply of domestic
coal and rationalization / swapping of coal which will be passed on to DISCOMs
/ consumers.
UDAY is optional for all States.
However, States are encouraged to take the benefit at the earliest as benefits
are dependent on the performance.