Ministry pushes power schemes

85 schemes worth Rs 1,500 crore identified for financing.

After a cut in allocations for the Accelerated Power Development and Reform Programme (APDRP) for the next financial year due to under-utilisation, the power ministry has recommended 85 schemes worth Rs 1,500 crore for financing in the current fiscal.

The steering committee of the ministry, which met last week, has suggested the clearing of 85 schemes, from 14 states, for funding under the programme.

The recommendation will be forwarded to the finance ministry, which is in charge of disbursing funds to the states for the programme.

The steering committee has suggested the approval of schemes worth Rs 457 crore for Jammu and Kashmir, Rs 252 crore for Uttar Pradesh and for Rs 247 crore for Assam. In addition, it has suggested the financing of Rs 174 crore worth of distribution reform projects in Maharashtra.

It has recommended Rs 35 crore worth of schemes for Bihar, Rs 39 crore for Rajasthan, Rs 28 crore for West Bengal, and Rs 9 crore for Madhya Pradesh. For Karnataka and Kerela, projects worth Rs 15 crore and Rs 58 crore have been cleared. It has also approved a Rs 43 crore allocation for Tripura and a Rs 77 crore for Nagaland.

The allocation for the APDRP has been cut from Rs 3,500 crore in the current fiscal to Rs 2,100 crore in 2005-06, keeping in mind the low offtake of funds.

"In the period upto end-January 2005, there was no allocation under the investment component of the programme, while under the incentive component, the Centre had spent less than Rs 80 crore," said officials.

The APDRP was introduced in 2003 with the aim of accelerating distribution sector reforms. It aims to reduce AT&C losses to 15 per cent, bring commercial viability in the power sector, reduce interruptions, and increase consumer satisfaction. The scheme has two components, the investment component and the incentive component.

Under the former, additional central assistance of 50 per cent of project cost is provided for strengthening sub-transmission and distribution network. The balance has to be provided by SEBs and utilities from Power Finance Corporaiton, Rural Electrification Corporation, other financial institutions, or from their own resources as counter-part funds.

Release of funds, on the other hand, is linked to measurable targets. The performance criteria includes putting in place a regulatory framework, restructuring SEBs, reducing T&D losses, curtailing revenue arrears, planting load factor, reducing manpower and cash losses.

Under the incentive component, an incentive equivalent to 50 per cent of the actual cash loss reduction by SEBs/Utilities is provided as grant.

2000-01 is the base year for calculation of loss reduction in subsequent years.