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PM Modi unveils Revamped Distribution Sector Program

Revamped Distribution Sector Program that is based on reforms and results was adopted by the Union Cabinet, which is presided over by Prime Minister Shri Narendra Modi. By giving DISCOMs conditional financial assistance for the bolstering of supply infrastructure, the Scheme aims to increase the operational efficacy and financial viability of all DISCOMs/Power Departments, excluding those in the private sector. The eligibility for the assistance will depend on the DISCOM completing pre-qualifying requirements and achieving basic minimum benchmarks that will be assessed using an agreed-upon evaluation system linked to financial improvements. Instead of using a one-size-fits-all approach, the implementation of the Scheme would be dependent on the action plan developed for each state.

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KEY POINTS:

  • With an expected GBS from the Central Government of Rs. 97,631 crore, the Scheme will have an outlay of Rs. 3,03,758 crore.
  • The current approved projects for the Union Territories of J&K and Ladakh under the Schemes of IPDS, DDUGJY, and PMDP-2015 are proposed to be incorporated into this Scheme, and the savings from their GBS would be included in the total expenditure of the Revamped Distribution Sector Scheme under the current terms and conditions until their expiration on 31 March 2022.
  • The funds under these Schemes would be accessible for the approved ongoing projects under the Prime Minister’s Development Program for the Union Territories of J&K and Ladakh under IPDS and DDUGJY as well as the identified projects under IPDS through the end of March 2023.
  • In accordance with predetermined and agreed-upon performance trajectories, such as AT&C losses, ACS-ARR gaps, infrastructure upgrade performance, consumer services, hours of supply, corporate governance, etc., the DISCOM‘s performance is evaluated annually under the terms of the Scheme.
  • For DISCOMs to qualify for funding under the Scheme in that year, they must receive at least 60 percent of the possible points and pass a minimum standard in relation to specific criteria.

Objectives of the Scheme:

  • By 2024–2025, AT&C losses should be reduced to 12–15% levels across all of India.
  • ACS-ARR gap to be closed by 2024–2025.
  • Enhancing Quality, Reliability, and Affordability of Power Supply to Consumers Through a Financially Sustainable and Operationally Efficient Distribution Sector.
  • Developing Institutional Capabilities for Modern DISCOMs.

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