NEW DELHI: Union power and renewable energy minister RK Singh has asked all states to bid out loss making areas of electricity distribution companies to frachisees. The minister has sent letters to power ministers of states seeking immediate actions to cut down on financial losses of distribution companies.
The minister has suggested that all feeders, transformers and consumers be metered and asked the state governments to do away with human interface in metering, billing and collection of electricity dues through implementation of smart prepaid meters. While large consumers can be billed on postpaid basis, their meters should be made remotely readable, he said.
Singh has also suggested that executive engineers, superintendent engineers, chief engineers and chairpersons of distribution companies should monitor feeder-wise progress every month. “Where a particular feeder shows losses continuously, it may be given out on the franchisee system where the power is sold in bulk to the franchisee to get commission per unit. The selection of the franchisee may be by open bid on the quantum of commission required,” Singh has said in letters sent separately to power ministers of all the states.
Singh has also said that the national tariff policy is proposed to be amended to cap the amount of technical losses that can be passed onto power consumers to 15% from January 1, 2019. “There is no justification for the consumers to be asked to bear the cost of inefficiency and theft. The technical losses generally vary from 2.5% to 6.5%. There is no reason for any losses beyond that,” he said.
The minister has also asked the states to ensure that cross subsidy of more than 20% is not charged from industrial consumers and introduce differential tariffs for power consumption during peak and non-peak hours. The minister has already indicated that from April next year, wilful load shedding is proposed to be penalised.
Tying up adequate power purchase agreements and honouring them was necessary to revive investments in the sector, the minister said. “Before any distribution company is given a licence for a particular area, it should be able to show to the regulator that it has tied up sources of supply to meet 100% of annual average demand,” the letter said. “We are proposing to provide for this in the amendments which we propose to the Electricity Act,” it said.
Source: economictimes.indiatimes
