The power ministry after the completion of more than 18 months of operation of Ujwal DISCOM Assurance Yojana (UDAY) scheme for revival of debt-stressed discoms, launched in November, 2015 has said that the debt-laden power distribution companies (DISCOMs) in states which participated in this scheme have achieved net savings of approximately Rs 15,000 crore till March 2017. It added that the Average Cost of Supply (ACS) and Average Revenue Realised (ARR) gaps have come down by almost 14 paise per unit and the aggregate technical and commercial (AT&C) losses have reduced by almost 1 percent in fiscal 2017.
The ministry said these states have taken over the targeted debt of Rs 2.09 lakh crore of their Discoms under borrowing exemption from the FRBM Act given in UDAY for the years 2015-16 and 2016-17. The process of states taking over the targeted debts and issuing them as SDL Bonds has now been completed. As of now, the participating discoms have to issue Bonds worth approximately Rs 37,000 crores, which would be done in due course. Rest of the debt with discoms is mostly in the nature of capex, which pays for itself, or Scheme based debt, which converts into grants fully or partially. Thus, they are not required to be taken over by the States.
As per the provisions of the UDAY Scheme, the states would start taking over losses of discoms in a graded manner from now on, starting with taking over 5 percent of the losses of FY17 from the current financial year. The ministry further said that continued, concerted and coordinated efforts by the Centre, States and discoms, in the spirit of cooperative and competitive federalism, would help turn around the Distribution Sector by fiscal 2019.
