NE BUSINESS BUREAU
NEW DELHI, JUNE 30
The Cabinet Committee on Economic Affairs (CCEA) on Wednesday approved a five-year-long reform-based result-linked power distribution scheme worth Rs 3.03 lakh crore.
Briefing after the CCEA meet here, Power and New & Renewable Energy Minister R K Singh said, “We have done a lot for power distribution reforms. It needs to be strengthened. Today, the Cabinet has approved the new scheme worth Rs 3.03 lakh crore, including Rs 97,000 crore central outlay.”
He said the funds would be given to power distribution companies (discoms) to strengthen their system.
The Reform-Based Result-Linked Power Distribution Scheme was announced in Budget earlier this year.
On Monday, Finance Minister Nirmala Sitharaman again announced the scheme as part of stimulus package post second wave of COVID-19, to boost the economy.
The revamped reforms-based result-linked power distribution scheme will provide financial assistance to discoms for infrastructure creation, up-gradation of system, capacity building and process improvement.
It provides state-specific intervention in place of ”one size fits all”.
For availing this scheme, the states will have to pre-qualify criteria like publication of audited financial reports, upfront liquidation of state government”s dues/subsidy to discoms and non-creation of additional regulatory assets.
The scheme envisages 25 crore smart meters, 10,000 feeders, four lakh km of low-tension overhead lines planned under the ongoing works under central government schemes.
The central schemes Integrated Power Development Scheme, Deen Dayal Upadhyaya Gram Jyoti Yojana, and Pradhan Mantri Sahaj Bijli Har Ghar Yojana (Saubhagya) will be merged.
Total allocation will be Rs 3,03,058 crore, including central government share of Rs 97,631 crore.
Sitharaman had also said on Monday that states have already been allowed an additional borrowing for four years up to 0.5 percent of gross state domestic product annually (Rs 1,05,864 crore for 2021-22), subject to carrying out specified power sector reforms.
