States become the thorn in Centre's ambitious 24x7 power supply schemes

Infra in slow lane, states lag in fund utilization

The Centre has met its target of connecting all villages and households (99.99 per cent) through its two flagship schemes, Deen Dayal Upadhaya Gram Jyoti Yojana (DDUGJY) and Saubhagya. 

But, the other components of these schemes to ensure seamless power supply and robust infrastructure are far from completion. 

Of the sanctioned amount of Rs 43,439 crore for these works, only 41 per cent has been claimed by the states, which indicates slow project completion. 

The deadline for closing the power reform schemes is March next year, and all projects should complete by December this year. Apart from connecting villages and household, the other components of these schemes include feeder separation, feeder metering, household metering and new transformers, transmission and distribution infrastructure.

 

The data collated by Rural Electrification Corporation (REC) has shown most states have completed 30-60 per cent of the work under the DDUGJY. These states include Bihar, Jharkhand, West Bengal, Punjab, and Uttarakhand. These are also the same states where distribution companies face high losses. Large states such as Maharashtra, Uttar Pradesh, Rajasthan, Karnataka, Tamil Nadu and Madhya Pradesh are in the 60-90 per cent completion bracket. 

REC is the nodal agency for all rural electrification and access schemes. Business Standard has reviewed the data. REC in a latest presentation pointed out most states are not sharing details of village wise infrastructure and the closure proposals are not being audited. States are also not sharing details of interest accrual on the grant amount given by the Centre to the states. It also requested the states to expedite the closure of all the projects.  

However, state-owned power distribution companies (discoms), which implement these projects, are back at making losses again. Discoms recoiling to their sick financial status means harm for all reforms. It also leads to delay in payment to contractors and causes stress in the sector.

Recently, this paper reported, around 50 power meter manufacturers have dues of Rs 6,000 crore from states which installed these meters under several Central schemes especially Saubhagya.

The cumulative loss of discoms (21 states) stands at Rs 28,369 crore by end of FY19, up by 88 per cent over year before. 

This is when power demand is touching new records with new consumers being connected. In the past five years, the average power demand of the country has jumped 39.16 per cent. During this summer (April-July), India saw the highest ever power demand of 183,804 Mw.