Puducherry joins “UDAY” scheme ; would derive an overall net benefit of 378 cr

The Government of India, and the Union Territory of Puducherry signed a Memorandum of Understanding (MOU) under the Scheme UDAY – “Ujwal DISCOM Assurance Yojana” today for operational turnaround of the Union Territory’s Electricity Department. The signing ceremony was held in the august presence of the Minister of State ( IC) for Power, Coal & New and Renewable Energy  & Mines Shri Piyush Goyal here today.

Puducherry is the first Union Territory to sign MoU under UDAY. Along with the State of Madhya Pradesh which has also signed the MoU today, a total of 16 States/UT have joined the Scheme till date, with the combined DISCOM debt (including CPSU dues) of around Rs.2.51 lac crore that would be restructured as on 30^th September, 2015.

The MoU paves way for improving operational efficiency of the Electricity Department of the Union Territory. Through compulsory Distribution Transformer metering, consumer indexing & GIS mapping of losses, upgrade/change transformers, meters etc., smart metering of high-end consumers, feeder audit etc. AT&C losses and transmission losses would be brought down, besides eliminating the gap between cost of supply of power and realisation. The reduction in AT&C losses and transmission losses to 12% and 0.95% respectively is likely to bring additional revenue of around Rs.165 crore during the period of turnaround.

While efforts will be made by the Electricity Department of the Union Territory to improve their operational efficiency, and thereby reduce the cost of supply of power, the Central Government would also provide incentives to the Govt of UT for improving Power infrastructure in the Union Territory and for further lowering the cost of power. The Central schemes such as DDUGJY, IPDS, Power Sector Development Fund or such other schemes of MOP and MNRE are already providing funds for improving Power Infrastructure in the Union Territory and additional/priority funding would be considered under these schemes, if the UT/Electricity Department meets the operational milestones outlined in the scheme. The UT shall also be supported through additional coal at notified prices and in case of availability, through higher capacity utilization, low cost power from NTPC and other CPSUs.Other benefits such as coal swapping, coal rationalization, correction in coal grade slippage, availability of 100% washed coal would help the state to further reduce the cost of Power. The UT would gain around Rs.135 crore due to these coal reforms.

Demand Side interventions in UDAY such as usage of energy-efficient LED bulbs, agricultural pumps, fans & air-conditioners and efficient industrial equipment through PAT (Perform, Achieve, Trade) would help in reducing peak load, flatten load curve and thus help in reducing energy consumption in the Union Territory of Puducherry. The gain is expected to be around Rs.72 crore. Further, with improved efficiency, the Electricity Department would be in a better position to borrow funds at cheaper rates for Power infrastructure development/improvement in the UT.

An overall net benefit of approximately Rs.378 crore would accrue to the UT by opting to participate in UDAY, by way of cheaper funds, reduction in AT&C and transmission losses, interventions in energy efficiency, etc. during the period of turnaround.

The ultimate benefit of signing the MOU would go to the people of Puducherry. Reduced levels of transmission and AT&C losses would mean lesser cost per unit of electricity to consumers. Further, an operationally healthy Electricity Department would be in a position to supply more power. The scheme would allow speedy availability of power to around 7948 households in the UT that are still without electricity. Availability of cheaper, round the clock power would boost the economy, promote industries, thereby improving employment opportunities for the people of the Union Territory of Puducherry.