Financial, operational turnaround of MSEDCL not achieved: CAG report

The compliance audit report of the Comptroller and Auditor General of India (CAG) for fiscal 2021 that was tabled in the Maharashtra Legislature on Friday said the financial and operational turnaround of state-run power distribution firm MSEDCL was not achieved despite implementation of the Ujwal DISCOM Assurance Yojana (UDAY).

The report, which was tabled in the Assembly and the Legislative Council on the last day of the Monsoon session, said Maharashtra State Electricity Distribution Company Limited, also called MahaVitaran, received Rs 4,960 crore from the state government under the UDAY scheme to repay its high cost debt.

However, MSEDCL did not receive any other dedicated fund to achieve various operational parameters, which it had improve through its own resources or under other Central/state schemes, as per the report.

The state-run power firm approached the state government in 2017 for availing guarantee for raising bonds of Rs 1,653 crore in accordance with the government resolution of December 2016, but this guarantee was denied, the report said.

"There was no firm commitment from the state to expeditiously clear the MSEDCL's outstanding dues. MSEDCL could not achieve its targets of bringing down the aggregate technical and commercial (AT&C) losses to the desired level," it said.

On the contrary, AT&C losses of MSEDCL had increased from 16.9 per cent in 2018-19 to 20.73 per cent in 2020-21 due to poor collection mainly from agricultural consumers and various state government departments. the report added.

This resulted in the main objectives of achieving financial and operational turnaround of MahaVitaran not getting achieved in spite of the UDAY scheme being implemented, the report said.

The report said the state government must ensure all electricity dues of MahaVitaran from departments and local bodies towards public water works and street lights are cleared in a time bound manner.

The report said MahaVitaran should complete DT (Direct Connected) metering and feeder segregation expeditiously and reduce AT&C losses to 15 per cent or less by improving its billing and collection efficiency.