PM Modi urges states to clear pending dues to power generation companies

Power distribution companies are owed more than 60 thousand crore rupees from many government departments, and local bodies.

PM Modi urges states to clear pending dues to power generation companies
Prime Minister of India Shri Narendra Modi

New Delhi: Prime Minister Shri Narendra Modi today on July 30, 2022 launched the Revamped Distribution Sector Scheme. He interacted with the beneficiaries of various schemes. On the ocassion he said losses in our distribution sector are in double digits, whereas in the developed countries of the world it is in single digit. This means that we have a lot of wastage of electricity and therefore we have to generate more electricity than we need to meet the demand for electricity. 

There is a lack of investment in reducing distribution and transmission losses in many states.

It is remarked that different states have outstanding dues of more than Rs 1 lakh crore, PM said. They have to give this money to power generation companies. Power distribution companies are owed more than 60 thousand crore rupees from many government departments, and local bodies. He said that these companies are not able to get even the money that has been committed for subsidy on electricity in different states on time and in full. This arrear is also more than Rs 75,000 crore. Those responsible for activities ranging from the generation of electricity to the door-to-door delivery, their about two and a half lakh crore rupees are trapped.

Addressing the gathering, the Prime Minister said Energy and power sectors have a huge role to play in accelerating India's progress in the next 25 years. The strength of the energy sector is also important for Ease of Doing Business and is equally important for Ease of Living. He said that the projects launched today are significant steps in the direction of green energy and energy security for the county. These projects will strengthen India’s renewable energy goals, commitment and aspirations of its green mobility, he said.

The Ministry of Power’s flagship Revamped Distribution Sector Scheme is aimed at improving the operational efficiencies and financial sustainability of the DISCOMs and Power Departments. With an outlay of over Rs. 3 lakh crore over a period of five years from FY 2021-22 to FY 2025-26, the scheme aims to provide financial assistance to DISCOMs for modernization and strengthening of distribution infrastructure, focussing on the improvement of the reliability and quality of supply to end consumers. It also aims to reduce the AT&C (Aggregate Technical and Commercial) losses to pan-India levels of 12-15% and the ACS-ARR (Average Cost of Supply-Average Revenue Realized) gap to zero by 2024-25 by improving the operational efficiencies and financial sustainability of all state-sector DISCOMs and Power Departments.