FINANCIAL LOSSES FOR DISCOMS FALLING UNDER UDAY SCHEME DECREASE

In a recent analysis in the Financial Express, those discoms which are a part of the Ujjwal Discom Assurance Yojna (UDAY) scheme have seen a reduction in their financial losses by 21.5%.  This amounts to a saving of Rs 40,295 Cr for FY 2017. Even the states which were earlier burdened due to huge financial losses have witnessed a drop in the losses by a significant percentage. For example, Tamil Nadu saw a decrease of Rs 3,783 Cr in its losses which is a decrease of about 35%. The liquidity profile of the discoms has also improved, as per the ICRA.
 
The power ministry opined on this matter saying that “with more projects being awarded, there should be a palpable difference on the metering front – a vital area which helps to reduce technical losses and minimize outages”.  As of now, the number of distribution transformers being metered are just 45% of the target to be met by December 2017. Therefore, they are hoping that the situation will improve further.
 
Our previous analysis on the completion of one year of the UDAY scheme can be accessed here.