 "UP wants 100% coal linkage for thermal power plants")
In the backdrop of Uttar Pradesh Inc complaining about steep power tariffs, the state government has urged the Centre to increase the coal linkage for its thermal power plants from 65% to 100%.
The government said enhancing coal linkage would benefit power plants both in the state sector and those operated by private companies viz. Reliance Power, Bajaj Hindusthan, Lanco, Jaypee etc, which were set up after 2009 under a special package.
The government claimed ramping up coal linkage to 100% would reduce the per unit cost of energy generation and thus eliminate accumulated losses of the state power distribution companies (discom).
This demand was raised at the state power ministers' conference held at Goa last week. Uttar Pradesh (UP) Chief Minister Akhilesh Yadav, who also holds the energy portfolio, was represented by minister of state for energy Shailendra Yadav Lalai.
He said the discoms were reeling under losses and for making additional coal available to power plants at reasonable costs was imperative to reducing cost of generation.
In March 2016, Coal India Limited (CIL) had increased coal prices by Rs 170 per tonne. Besides, additional levies of Rs 24 per tonne and Rs 200 per tonne were imposed as coal royalty and clean energy cess respectively.
These factors had contributed to the increase in energy costs, since coal availability and prices have a direct bearing on the cost of generation.
Earlier, UP had made budgetary provisions of nearly Rs 40,000 crore to issue bonds to discoms under Ujjwal Discom Assurance Yojna (UDAY).
UDAY is a flagship scheme of the NDA government at the Centre for the financial restructuring of the ailing discoms, which have collectively accumulated losses of Rs 3,60,000 crore pan-India due to inefficient transmission and distribution of energy.
In UP, the aggregate technical and commercial (AT&C) are to the tune of over 30%, which suggests inefficient discoms, rampant power theft, low bill realisation and corruption. AT&C losses are sum of technical loss, commercial loss and shortage due to non-realisation of total billed amount. It includes power theft and losses during transmission and distribution of power.
Till September 30, 2015, the state discoms had total losses of Rs 53,935 crore. As share capital, the state government had issued bonds for 15 years amounting to Rs 39,134 crore or 75% of losses. The remaining almost Rs 14,000 crore worth of losses would be borne by the discoms.
Due to the high AT&C losses, UP routinely faces energy demand-supply chasm, which results in power outages, especially in villages and smaller towns. The state is targetting to tame this figure to under 10% by 2017.
