UDAY scheme helped discoms of 24 states cut losses to Rs 369 bn in FY17

R K Singh said the interventions under UDAY have yielded encouraging results

Government's UDAY scheme has helped debt-laden discoms of 24 states to reduce losses to Rs 369 billion in 2016-17 from Rs 515.9 billion in the previous financial year, Parliament was informed today.

"As per data furnished by the states, the aggregate net losses of discoms participating in UDAY have come down from Rs 51,590 crore in 2015-16 to Rs 369 billion in 2016-17," Power Minister R K Singh said in written reply to Lok Sabha.

The Ujwal DISCOM Assurance Yojana (UDAY) was launched for the operational and financial turnaround of state-owned Power Distribution Companies (discoms).

The scheme aims to reduce interest burden, cost of power and power losses in distribution sector, besides improving operational efficiency of discoms.

The minister said the interventions under UDAY have yielded encouraging results.

The participating states have achieved an improvement of one per cent in Aggregate Technical & Commercial (AT&C or distribution) losses and Rs 0.17 a Unit in the gap between Average Cost of Supply and Average Revenue Realised in 2016- 17, he said.

Earlier in the day, Singh tweeted: "Government to conduct auctions next month for power plants that do not have power purchase agreements (PPAs) and is working on a model, whereby demand from all states will be aggregated and tariff-based competitive bids will be invited from power-generating companies."

These auctions would allow generators to bid for medium- term (5-7 years) PPA. This will help revive those commissioned stressed coal-based capacities which have not inked any PPAs.

The move is expected to help nearly 12GW commissioned thermal power plants to get medium-term PPAs which is a prerequisite for getting coal linkage.