WITH an eye on ensuring 24×7 power supply to every person in India, the government has decided to focus on timely payments by power Distribution Companies (discoms) to companies that generate the electricity. The government is also going to focus on round-the-cock availability of renewable energy.
In June this year, the Union Ministry of Power implemented the late payment surcharge rules as outstanding dues of power discoms remain eye-wateringly high. The move will ensure the timely payment of dues by discoms to power-generating companies (gencos). The ministry also converted their long outstanding overdue into equated monthly instalments.
As a result, the dues of discoms have been reduced to around Rs 1.13 lakh crore in the six months leading to November 2022 – the figure for June 2022 was Rs 1.32 lakh crore, translating into a decline of around 14 per cent.
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“We made one nation one grid, enabling [the] sale of power to any part of the country irrespective of its source of generation. All of these contributed to reduced power cost[s]. This increased availability of power to rural areas,” Union Power and New & Renewable Energy Minister R K Singh told PTI.
On renewable energy, Singh said, “We have not calculated round-the-clock green energy proportion. But overall, roughly renewable energy proportion is around 20-25 per cent.”
The minister also mentioned the strengthening of the power distribution system, which was achieved by spending Rs 2,04,000 crore, substantially increasing the power supply to rural areas.
“From 12 hours in 2015 to over 22.5 hours in 2022, we increased power supply to rural areas to a great extent. It is around 23 hours in urban areas," he said.
As part of efforts for 24×7 power supply, Singh said the focus will be mainly on rural areas as urban areas are getting almost round-the-clock supply of electricity.
He said that electricity shortage in 2012 was around 9-10 per cent, which came down to 4.5 per cent in 2013 in energy terms. He added that this shortage is just 0.4 per cent in 2022.
“It is only (in places) where discoms do not have money to purchase the power. We have made the entire nation power surplus. Our demand is 2,15,000 MW while our service capacity is 4,04,000 MW. We have [a] surplus capacity and have strengthened the entire distribution system through transmission lines," Singh said.
Power distribution has traditionally been the weakest link in India’s ambitious electrification programme. The Economic Survey for 2020-21 highlighted that India’s power losses are “substantial” while the United States Energy Information Administration (EIA) estimates that about 5 per cent of the total generated electricity is lost each year during transmission and distribution. Worldwide, a 6-8 per cent loss in electricity transmission and distribution is considered ‘normal’.
Singh meanwhile said that AT&C (Aggregate Technical & Commercial) losses were reduced by almost 5 per cent in FY22 owing to measures taken by the ministry.
India's average Aggregate Technical & Commercial (AT&C) loss in the electricity sector was 22.32 per cent in 2020-21, revealed the Power Finance Corporation's (PFC) annual performance report on power utilities.
The ministry carried out a preliminary analysis of data involving 56 discoms for FY22. These discoms contributed to more than 96 per cent of the power supply and the analysis indicated that the AT&C losses of discoms declined to 17 per cent from 22 per cent in FY21.
The reduction in AT&C losses has resulted in the gap between the Average Cost of Supply (ACS) and the Average Realisable Revenue (ARR) reducing.
Last year, the Central Government approved a ‘Revamped Distribution Sector Scheme - A Reforms based and Results linked Scheme’ with the objective of improving the quality and reliability of power supply to consumers through a financially sustainable and operationally efficient distribution sector. According to the Power Ministry, the scheme’s aim is to reduce the AT&C losses to pan-India levels of 12-15 per cent and the ACS-ARR gap to zero by 2024-25, for which Rs 3,03,758 crore was earmarked.
The ministry also plans to invest to further strengthen the power transmission system in the backdrop of India's goal of having 500 GW of renewable energy by 2030.
“Robust power transmission network is the key catalyst in driving India's 500 GW renewable energy ambition. The recently announced road map for the transmission sector addresses the urgency with which India needs to develop its transmission infra for renewable energy evacuation,” PTI quoted Sterlite Power MD Pratik Agarwal as saying.
He added, “The estimated investment need of Rs 2.44 trillion in the inter-state transmission segment spells enormous opportunity for the industry.”
The issues related to ROW (Right Of Way), land acquisition as well as permits and clearances need to be fast-tracked to ensure that these transmission corridors are executed in a timely manner, he opined.
Agarwal added that the changing composition of installed generation capacity in the country, increase in electrification, burgeoning power demand and the push to promote manufacturing are strong tailwinds requiring a persistent thrust on investment in power transmission in the immediate and long term.
(With inputs from PTI)