Cost-revenue gap of discoms drop 68% as government links funding to performance – Times of India

NEW DELHI: The hole between the price of energy and income realisation of distribution firms (discoms) narrowed 68% in 2021-22 from 2020-21 as the facility ministry linked funding and provide entry to time-bound enchancment in systemic effectivity.
Knowledge of 56 discoms, accounting for greater than 96% of distributed energy, present the common cost-revenue hole (on subsidy acquired foundation, excluding regulatory revenue and UDAY grant, declining from 69 paise per unit in 2020-21 to 22 paise in 2021-22.
The reforms push additionally resulted in line losses, an euphemism for theft and different systemic inefficiencies and referred to as mixture technical and industrial loss, from at 21-22% to 17%, indicating higher metering and billing of energy provided.
Enhancements in these two parameters will result in improved monetary well being of discoms, permitting them to buy energy for making certain 24X7 provide and preserve or improve networks. Financially more healthy discoms is vital for getting ready the facility marketplace for post-energy transition part.
The enhancements are a consequence numerous steps the ministry has taken in the previous few years. Step one in direction of making each paise given to discoms depend was taken by revising the prudential norms for lending to discoms in September 2021.
The revised norms barred loss-making discoms from accessing funds from lenders till the respective state governments gave its seal of approval on an motion plan for decreasing losses inside a selected timeframe.
There have been different rules that have been introduced in to manage funding below different heads for discoms until that they had a state-approved plan to enhance varied parameters to pre-decided ranges inside a given timeline and permitted by the respective state authorities.
In October 2021, the ministry introduced in rules offering for obligatory power accounting and power auditing for all discoms. In June 2022, late cost surcharge guidelines, saying that entry to energy from the grid or exchanges shall be minimize until discoms [ay their payments promptly.
But it surely was not all stick. The ministry prolonged financing below varied schemes for endeavor loss discount measures.

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