AT&C losses reduce from 25.5 percent in FY13 to 15.37 percent in FY23

Projects worth Rs. 2.77 lakh crore have been sanctioned under RDSS for loss reduction and smart metering works (State-wise details placed at Annexure). Sanctioned infrastructure works are at various stages of implementation and physical progress of 17 percent has been achieved till date.

The AT&C loss of distribution utilities at the national level has reduced from 25.5% in FY 2013 to 15.37% in FY 2023 and the ACS-ARR gap has reduced from Rs. 0.84/kWh in FY 2013 to Rs.0.45/kWh in FY 2023. Further, the hours of supply for rural areas has improved from 12.5 hrs in FY 2014 to 21.9 hrs in FY 2024. Similarly, for urban areas it has improved from 22.1 hrs in FY 2014 to 23.4 hrs in FY 2024. Union Minister of Power Manohar Lal Khattar informed Lok Sabha.

AT&C Losses and ACS-ARR Gap for a utility are the key financial and operational indicators of its performance. Losses directly impact the cash flow and affects their financial position thereby forcing them to supply costly electricity to consumers. Reduction in AT&C losses and ACS-ARR Gap improves the finances of these utilities, which will enable them to better maintain the system and buy power as per requirements; benefitting the consumers.

To address these losses, mandatory pre-qualifying criteria have been prescribed under the scheme which includes timely publishing of audited annual accounts & quarterly accounts, timely release of subsidy and Government department dues by States/UTs, no new creation of regulatory assets, pre-paid metering in Government establishments, timely payment of GENCO dues and timely publishing of tariff & true up orders. Based on performance of the utility against parameters mentioned under Result Evaluation Matrix, which include achievement against major financial & operational parameters, they are evaluated. Thus, assistance has been linked to performance.

Further, projects worth Rs. 2.77 lakh crore have been sanctioned under RDSS for loss reduction and smart metering works (State-wise details placed at Annexure). Sanctioned infrastructure works are at various stages of implementation and physical progress of ~17% has been achieved till date.

DPRs for the proposed works are submitted by the utilities, keeping in view the specific issues faced by them, with the approval of the State Cabinet after recommendation of the Distribution Reforms Committee (DRC) which are subsequently approved, as per scheme guidelines, by the Monitoring Committee constituted under RDSS.  The maximum financial assistance for loss reduction works given to utility is 60 percent of the approved project cost, while for special category States it is limited to 90 percent. Further, grant is also provided for Smart Metering works, as per the scheme guidelines, based on number of feeders, distribution transformers and consumers proposed to be metered.

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In addition to above, other initiatives taken to improve power distribution sector include Electricity (Late Payment Surcharge and Related Matters) Rules 2022, Rules for implementation of Fuel and Power Purchase Cost adjustment (FPPCA) and Cost reflective tariff so as to ensure that all prudent cost for supply of electricity are passed through, Additional Borrowing space of 0.5 percent of GSDP to the States linked to power sector reforms, Additional Prudential Norms for lending by Power Finance Corporation (PFC) Limited and REC Limited based on the performance of the utilities etc.

The Union government launched the Pradhan Mantri Sahaj Bijli Har Ghar Yojana (SAUBHAGYA) in October, 2017 with the objective to achieve universal household electrification for providing electricity connections to all willing un-electrified households in rural areas and all willing poor households in urban areas in the country.

As reported by the States, around 2.86 crore households have been electrified since the launch of SAUBHAGYA, up to 31.03.2022. For the State of Maharashtra, a total 5,89,242 households were electrified which included 5,42,914 and 15,790 number of households through grid in Rural and Urban areas respectively and 30,538 households in rural areas through off-grid mode. All sanctioned works have been completed under SAUBHAGYA and scheme stands closed as on 31.03.2022.  Further, under Revamped Distribution Sector Scheme (RDSS), electrification works for 9,036 households have been sanctioned for the State of Maharashtra under PM-JANMAN (Pradhan Mantri Janjati Adivasi Nyaya Maha Abhiyan) and DA-JGUA (Dharti Aaba Janjatiya Gram Utkarsh Abhiyan). 

RDSS was launched by the Government of India, in July 2021.  The main objective of the scheme is to support Distribution utilities i.e. DISCOMs/Power Departments (PDs) to improve the operational efficiencies and financial sustainability of distribution sector so as to provide quality and reliable supply of power. The scheme envisages reducing the Aggregate Technical and Commercial (AT&C) Losses to 12-15 percent at pan-India level and Gap between Average Cost of Supply and Average Revenue Realised (ACS-ARR Gap) to Zero by 2024-25.

Total outlay of RDSS is Rs 3,03,758 Cr including Gross Budgetary Support (GBS) of Rs. 97,631 Cr. The scheme duration is for 5 years (i.e. FY 2021-22 to   FY 2025-26). 48 DISCOMs across 30 States/ UTs have participated under RDSS.

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