Madhya Pradesh, Puducherry join UDAY scheme to revive discoms

Madhya Pradesh on Wednesday formally joined Centre's UDAY scheme meant for revival of debt-ridden power discoms and the move will save the state Rs 17,515 crore during the period of turnaround.

Besides, Puducherry also signed an MoU under the UDAY (Ujwal Discom Assurance Yojana) scheme and became the first union territory to formally join the scheme, Power Ministry said in a press release.

It said that an overall net benefit of about Rs 17,515 crore would accrue to Madhya Pradesh by opting to participate in UDAY, by way of savings in interest cost, reduction in AT&C losses, interventions in energy efficiency, coal reforms etc during the period of turnaround.

The scheme would allow speedy availability of cheaper power to around 131 villages and 52.86 lakh households in Madhya Pradesh that are still without electricity.

The amount of debt being taken over by the Madhya Pradesh is Rs 26,055 crore, being 75% of the total discom debt of Rs 34,739 crore outstanding as on September 30, 2015, as envisaged in the scheme.

The scheme also provides for the balance debt of Rs 8,684 crore to be re-priced or issued as state guaranteed discom bonds, at coupon rates around, 3% less than the average existing interest rate.

With these two state/UT joining the scheme, the number of states/UT that have joined UDAY goes up to 16, the release said.

The combined discom debt (including CPSU dues) that would be restructured in respect of these (16) states is around Rs 2.51 lakh crore as on September 30, 2015.

It further said that an overall net benefit of about Rs 378 crore would accrue to the UT of Puducherry 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. The scheme would allow speedy availability of power to around 7,948 households in the UT that are still without electricity, it added.