Ahead of the upcoming Union Budget on Saturday, Power Minister R K Singh said that the UDAY (Ujwal DISCOM Assurance Yojana) scheme was not a failure, however, an improved version of the programme, meant for revival for Discoms and to ensure 24X7 power, maybe announced in Budget.
During an event, the Minister said quoted PTI that “we asked for a new (UDAY) scheme. We had discussions with the Finance Ministry… I am optimistic that the new scheme will find a place in the budget.”
He was speaking at the sidelines of the listing ceremony of the USD 750 million international bond of Power Finance Corporation (PFC) at NSE.
Singh further added that “it would be great if the scheme finds a place in the budget because it will address the requirements of the distribution companies… for ensuring 24X7 power supply.”
Power Ministry launched UDAY Scheme which was approved by the Union Cabinet on November 05, 2015. It envisages financial & operational turnaround of the power distribution utilities (Discoms) of the country.
The Minister also hinted that unlike earlier practice of having multiple schemes, the Centre would channelise all efforts through one scheme, and states would have to reduce the losses of Discoms to get all the benefits.
Government is considering on combining the features of UDAY, Deen Dayal Upadhyaya Gram Jyoti Yojana (DDUGJY) and Integrated Power Development Scheme (IPDS) under one umbrella.
Further elaborating, RK Singh said that under the new scheme government will provide assistance for loss reduction, “that assistance will be in terms of technology and modern equipment to reduce the losses.”
Including all previous schemes’ elements, “now, there will be only one scheme for Ministry of Power,” Singh added.
However, the scheme has a conditionality that Discoms must work out their trajectory for loss reduction, the Minister said and funds will be released only if the trajectory is adhered to.
“The UDAY scheme is not a failure. We have reduced losses of Discoms from over 22 percent to around 18 percent,” he stated targeting to trim Discom losses to below 15 per cent.
Besides, the Centre is also looking at tightening the prudential norms of the REC and PFC, he added.
Now, PFC and REC would not be able to finance those firms or Discoms which would not reduce losses, Singh further said.