The Haryana Power Distribution Utilities is expeditiously working to avail the proposed bailout package by the Government of India for restructuring the ailing power distribution utilities.
Talking to Business Standard, the Chairman and Managing Director of Haryana Power Distribution Utilities (Uttar and Dakshin Haryana Bijli Vitran Nigam), Devinder Singh said that short term liabilities of the Haryana discom as on March 31, 2012 stood at Rs 18,000 cr. It was imperative to comply to the pre-requisites laid down by the Government of India to seek the funds from centre and state government to restructure the short term liabilities of the state utilities.
The state government has approved to contribute 50% of the total amount of funds required to meet the deficit but the cabinet approval is yet to come.
After the approval of state cabinet, the proposal would be sent to GOI for its pursual.
Meanwhile, the finance department of Haryana is engaged in finalising the exact amount of the state’s contribution.
Singh apprised that from year 2001 to the year 2012, the cost of power increased by 300% in Haryana, power tariff at the same was revised by 50%-60%. This created a huge gap between the ARR (Average Revenue Realised) and the ACS (Average Cost of Supply) to the consumers.
The state has the Transmission and Distribution losses to the tune of 30%. The obsolete distribution network in the state does not provide a fool proof mechanism to bring down the losses. But anything above 15% is alarming and needs to be tackled firmly.
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The state has hired REC (Rural Electrification Corporation) to prepare the DPR (Detailed Project Report) to seek interest subsidy under the Interest subsidy linked reform .
The GOI has prepared a corpus of Rs 25,000 cr for the upgradation of power distribution infrastrcuture across India and this scheme is a part of that.
It is essential to bridge the gap between ARR and ACS gradually by increasing the tariff and cutting down the T&D loss.
In a timeframe of five years, the debt ridden state utilities seeking restructuring should do away with the need of working capital except for two month revolving capital as the charges from consumers are recovered post usage.