Union Territories discoms privatisation on track: Power Ministry

Also, with the technical assessment nearing completion for the Chandigarh breakdown, financial offers will open next week. Torrent Power, ReNew Power, Adani Group, NTPC Ltd, Tata Power and Sterlite Power have made an offer to acquire the Chandigarh disk. While both processes faced legal challenges, the plan has returned to its course.

Mint previously reported on India's work to privatize the ruptures of eight Union territories, plans for which were articulated by Finance Minister Nirmala Sitharaman when she announced the fourth tranche of the ₹20 trillion stimulus package to fight the economic crisis led by covid.

While briefing reporters after a review meeting of state governments and the head of riots, Union Energy and New and Renewable Energy Minister Raj Kumar Singh said that while some UTs saw legal challenges, the plan is again. up for grabs now.

Unlike riots run by state governments, riots in Union territories are managed by the Center. Deloitte is executing the sales process for the discoms in Chandigarh, Puducherry and the Andaman and Nicobar Islands, while SBI Capital Markets Ltd has the mandate for Dadar and Nagar Haveli, Daman and Diu, Jammu and Kashmir and Ladakh.

Kumar added that the request for proposal (RFP) for the Andaman and Nicobar and Puducherry Islands is being finalized and in the last stage. This will be followed by the Lakshadweep utility process.

"So, we are making progress," Kumar said, adding: "For Jammu and Kashmir, they had requested some studies to develop the options, so the study is ongoing."

UT's electricity privatization process was started for the problems of Chandigarh, Dadar and Nagar Haveli, and Daman and Diu. Torrent Power has made the highest bid for Dadra and Nagar Haveli, and Daman and Diu power breaks; where the other bidders were ReNew Power, Adani Group and CESC Ltd.

"There is quite a significant advance, in two great places the offers have arrived and they are in advanced stages," said Kumar.

The growing private sector interest in India's electricity distribution space comes in the context of the Electricity (Amendment) Bill of 2021, with proposed amendments, such as measures to "de-license" the electricity distribution business. energy and make the sector more competitive. The Union cabinet may consider the bill shortly and publish cabinet approval; The bill is expected to be tabled at the current monsoon session of Parliament.

This comes in the context of the cabinet committee on economic affairs last month that approved the marquee. ₹3.03 billion power disconnection reform schemes, in which the Center's participation will be ₹97.631 crore.

“The Minister of Energy said that the objective of the Scheme is to reduce Aggregate Technical and Business Losses (AT&C Losses) to 12-15% at the All India level and to reduce the gap between Average Cost of Supply (ACS) and Average Realized Revenue (ARR) to zero for 2024-25, "the Energy Ministry said in a statement.

Funds will be awarded to issues subject to meeting reform-related milestones.

“Shri Singh added that a DISCOM that is experiencing losses will not be able to access funds under this scheme unless they develop a plan to reduce losses, list the steps they will take to reduce such losses and the timing of losses, get their approval from the State Government and file it with the Central Government. The flow of funds from the plan will depend on adhering to the loss reduction trajectories. The energy minister said that this is the "scheme" of the "Scheme," "the statement added.

Some discomforts appear to have turned around with 15 state problems in Andhra Pradesh, Gujarat, Tamil Nadu, Karnataka, Uttar Pradesh, West Bengal, Manipur and Madhya Pradesh, reducing their losses by more than 10% in 2019-20. In addition, the gap between the cost of electricity purchased (average cost of supply, or ACS) and supplied (average realizable income, or ARR) was reduced to 28 paise per unit in 2019-20 for the country and led to a drop in the descomposition. losses by more than a third to ₹38,000 crore of ₹Rs 61,360 crore in fiscal year 2019, according to government data.

“The deadline for DPR submission would be December 31, 2021 and no submission will be accepted beyond that deadline, Power Minster added. Shri Singh further added that although electricity services are considered essential basic public services, we must remember that any service / product has a cost and the cost must be recovered to keep the wheel of progress moving and therefore also has an aspect commercial which is very important. for the continued growth required of the sector, "the statement read.