Implementation of Ujwal Discom Assurance Yojana (UDAY) – EQ Mag

The Union Minister for Power and New & Renewable Energy has informed about the status of repayment of the bonds issued by the State Governments and the DISCOMs under the UDAY scheme. The Minister informed that as per OM dated 20th November, 2015 of UDAY Scheme (Clause 7), for Operational and Financial Turnaround of Power Distribution Companies–

State will issue non-SLR (Statutory Liquidity Ratio) including SDL (State Development Loans) bonds in the market or directly to the respective bank/ financial Institution holding the DISCOM debts to the appropriate extent. Proceeds realized from issue of the bonds to the banks / Financial Institutions (FIs) shall be entirely transferred by the State to DISCOMs, which in turn shall discharge the corresponding amount of Banks / FIs debts.
Non SLR bonds issued by the State will have a maturity period of 10-15 years with a moratorium on repayment of principal up to 5 years, as required by the State.

The Minister informed that the summary of bonds issued under UDAY scheme is as below. The maturity period of these bonds varies from State to State and is between 5 and 15 years.

Giving the details of the States that have achieved or failed to achieve the targets of reducing Aggregate Technical & Commercial (AT&C) losses and eliminating Average Cost of Supply-Average Realisable Revenue (ACS-ARR) gap under the UDAY scheme, the Minister informed that as a result of participation of DISCOMs under UDAY and other efficiency measures, State Power Distribution Utilities reported improvements which include:

AT&C losses have reduced from 23.70% in FY 2015-16 to 20.73% in FY 2019-20.
ACS-ARR Gap: The Gap between Average Cost of Supply (ACS) and the Average Revenue Realized (ARR) reduced from Rs. 0.54 per Unit in FY 2015-16 to Rs. 0.50 per Unit in FY 2019-20.

State-wise details of AT&C losses and ACS-ARR gap are given below.

AT&C LOSS

ACS-ARR GAP on Tariff Subsidy received (excluding Regulatory Income and Revenue Grant under UDAY for loan takeover)

Providing the details of the challenges and constraints faced in the implementation and monitoring of the UDAY scheme and the steps taken to address them, the Minister informed that the Ministry of Power vide Office Memorandum dated 19.01.2016 constituted Monitoring Committee under the Chairmanship of Secretary (Power) and the progress of the scheme and challenges faced were regularly reviewed during the Monitoring Committee meetings. No major challenges were reported for implementation of scheme. The period of the scheme was from FY2015-16 to FY2019-20.

This information has been given by the Union Minister for Power and New & Renewable Energy Shri R. K. Singh, in a written reply to a question, in Rajya Sabha today, August 2, 2023.