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Central government launched Revamped Distribution Sector Scheme to increase operational efficiency

Central Government has approved The Revamped Distribution Sector Scheme, which will cost Rs. 3,03,758 crore and is implemented over five years from FY 2021–2022 to FY 2025–2026. To boost supply infrastructure by giving DISCOMs result-linked financial support based on satisfying pre-qualifying criteria and attaining fundamental minimum benchmarks, in order to help DISCOMs increase their operational efficiencies and financial sustainability.

The objective of the Scheme-

  • The scheme’s objective is to increase the efficiency of consumers.
  • Cost and quality of power supply for consumers by creating a financially stable and operationally effective distribution sector.
  • By increasing the operational effectiveness and financial viability of all DISCOMs/Power Departments, with the exception of Private Sector DISCOMs
  • The Scheme seeks to reduce AT&C losses to pan-India levels of 12–15 percent and ACS-ARR gap to zero by 2024–25.

Advantages Under The scheme-

  • Under the Scheme for Pre-Paid Smart Metering, System Metering, and Distribution Infrastructure Works for Loss Reduction and Modernization, DISCOMs/Power Departments would have access to money.

Eligibility criteria for the scheme-

  • DISCOMs have to score a minimum of 60% of the marks
  • To be qualified for funding under the Scheme in that year.
  • One must meet minimal requirements with regard to a number of criteria.

The following are the components of the Scheme-

Part A: Prepaid smart metering, system metering, and distribution infrastructure upgrade are all covered in A’s financial support.
Part B: Enabling and Supporting Activities, Training, and Capacity Building.

The Revamped Distribution Sector Scheme was created to address state-specific demands after learning from the results of earlier schemes.

Listed below are a few of the key characteristics-

  • 500 AMRUT cities with AT&C Losses greater than 15% will receive priority for Prepaid Smart Metering.
  • MSMEs, industry, and commerce in all Union Territories
  • Offices of the government at the Block level and higher Other regions with significant losses

Provision for States in a Special Category-

  • All Special Category States shall be treated as the Special Category States, including the North-Eastern States of Sikkim and the States/Union Territories of Jammu & Kashmir, Ladakh, Himachal Pradesh, Uttarakhand, and Andaman & Nicobar Islands.
  • For Prepaid Smart Metering, “Other than Special Category” States are eligible for a grant of Rs 900 or 15% of the cost per consumer metre calculated for the entire project, whichever is lower. The matching award for “Special Category” States would be Rs 1350 or 22.5 per cent of the cost per consumer, whichever is less.
  • Additionally, if the DISCOMs install the desired number of Smart metres before December 2023, they will be eligible for a special incentive worth 50% of the grants specified above.

Prime minister’s thoughts about the scheme-

“Under the leadership of the Prime Minister, the government has taken multiple path-breaking initiatives in the power sector. These reforms have transformed the sector, with the focus being on making affordable power available for all. Electrification of about 18,000 villages which did-not have access to power earlier signified the commitment of the government towards ensuring last mile outreach,” said a press release by the Prime Minister’s Office.

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