Power Minister Manohar Lal expressed concern over the financial viability of power distribution companies (DICOMs) and stressed that states need to work on finding avenues to reduce their debt burden.
Addressing a meeting of power ministers of states and union territories on Tuesday, the minister said the difference between average cost of supply (ACS) and average realizable revenue (ARR) will increase by ₹0.21 per kilowatt-hour (kWh) in FY24. He pointed out that it had improved.
The Minister impressed upon the gathering that India’s peak electricity demand will reach 250 gigawatts (GW) in May 2024 and this will be met through collective efforts. However, as the demand for electricity increases, efforts to increase capacity are required.
discom health
Lal noted that the financial viability of discoms is “another concern”. Discoms are essential to the overall growth of the power sector in the country.
He said the ACS-ARR gap has improved from ₹0.45 per kWh in FY23 to ₹0.21 per kWh in FY24 as per preliminary calculations.
The minister stressed the need for states to ensure timely payment of government contributions and subsidies. For government dues, states may establish a centralized mechanism for payment of dues and must install prepaid smart meters in all offices by March 2025. States were asked to work on ways to reduce discom debt.
Lal said to promote smart meters, a 5 per cent rebate could be provided by the state to pre-pay consumers, and effective consumer engagement needs to be done.
He also said that discoms should work towards expeditious implementation of works sanctioned under the Revised Distribution Sector Scheme (RDSS).
This will help Dsicm bring innovative AI-based solutions to the problems it currently faces. Through a competitive process, 40 potential technology solutions will be incubated with a total financial support of up to Rs 3,700 crore under Powerthon-II and support of up to Rs 6,000 crore to scale up solutions already identified in the phase. Provided to discoms. 1.
It was stated that a composite ranking methodology has been developed for ranking of discoms to create healthy competition. The first rankings are expected to be published by January 2025.
Lal stressed that Dsicoms should effectively implement consumer rights under the Electricity Regulations and provide compensation to consumers for service deficiencies. Moreover, Dsicoms should promote rooftop installation under Prime Minister Surya Ghar Yojana.
He said that with the increasing demand for electricity, there is an increasing need for investment in this sector, and that each country may identify a power company and take it up for listing. There is also a need to improve efficiency, he said.
