The office of the Comptroller & Auditor General of India (CAG) has pointed a finger at the distribution companies (discoms) operating in Odisha for their inadequate spending of funds under Capital expenditure (Capex) scheme.
The discoms have also drawn flak from the CAG office for their inability to reduce aggregate technical & commercial (AT&C) losses by three per cent per year as mandated under the Capex programme.
The state energy department had launched the ambitious Capex programme in November 2010 to rein in high AT&C losses of four discoms- Central Electricity Supply Utility of Odisha Ltd (Cesu), North Eastern Electricity Supply Company of Odisha Ltd (Nesco), Western Electricity Supply Company of Odisha Ltd (Wesco) and Southern Electricity Supply Company of Odisha Ltd (Southco). However, only Rs 171.13 crore could be spent till July 27, 2013 even though fund to the tune of Rs 900 crore was available for Capex phase-I.
The discoms even failed to utilise Rs 300 crore government funding meant for Capex for 2010-11, showing slow progress in implementation of the programme.
The three discoms managed by Reliance Energy- Nesco, Wesco and Southco- were unable to arrange counterpart funding.
As per the notification of the energy department, the discoms were to slash AT&C losses by three per cent per annum in their areas of operation during the implementation of Capex programme.
But due to delay in execution of loan agreement, delay in finalisation of technical specification of materials, delay in placement of work orders as well as non- arrangement of counterpart funding by Reliance Energy controlled discoms, the work could not be executed in project areas as per schedule.
Consequently, the envisaged AT&C losses could not be curtailed, forcing the government to revise the completion of Capex programme till March 2014. Due to non-reduction in AT&C losses, the losses of discoms kept mounting year on year because of which they were unable to pay the monthly dues of state owned bulk power purchase Gridco.
The discoms had to grapple with AT&C loss of Rs 278.83 crore for 2012-13 due to slow execution of Capex work.
