Twenty-Seven Indian states and four union territories have so far joined the Ujwal DISCOM Assurance Yojana (UDAY) program which was implemented by the government of India to assist the financial turnaround of DISCOMs (utilities/distribution company). The state of Nagaland, and the union territories of Andaman & Nicobar Islands, Dadra & Nagar Haveli, and Daman & Diu are the new additions.
The new additions joined the program on its second anniversary. The Government of India signed memorandum of understanding (MoU) under the UDAY program with the state of Nagaland and with union territories of Andaman & Nicobar Islands, Dadra & Nagar Haveli, and Daman & Diu for operational improvements.
These signatories have joined the UDAY program only for operational improvement and will not undergo financial restructuring, no bonds will be issued for these four new additions.
Nagaland, Andaman & Nicobar Islands, Daman & Diu, and Dadra & Nagar Haveli will derive net benefit of ₹5.51 billion (~$85 million), ₹180 million (~$2.8 million), ₹100 million (~$1.5 million), and ₹130 million (~$2 million), respectively, by way of cheaper funds for capex, reduction in aggregate technical & commercial (AT&C) and transmission losses and interventions in energy efficiency, during the period of turnaround.
Through compulsory distribution transformer metering, consumer indexing and GIS mapping of losses, upgrading/changing transformers, meters, smart metering of high-end consumers, feeder audit, AT&C losses and transmission losses would be brought down, besides eliminating the gap between cost of supply of power and realization.
Demand side interventions under the UDAY program such as usage of energy-efficient LED bulbs, agricultural pumps, fans & air-conditioners and efficient industrial equipment through PAT (Perform, Achieve, Trade) will help in reducing peak load and flatten load curve of these states and union territories.
After a long interval, new signatories have joined the UDAY program. Prior to this, in April 2017, Mizoram had become the 26th state to join the UDAY program. Mercom had previously reported the various state governments participating in the UDAY program taking over a debt of ₹2.09 trillion (~$32.5 billion) from their DISCOMs. This is almost half of the ₹4.3 trillion (~$64 billion) of debt held by state DISCOMs.
Image credit: Mercom India