• UDAY suggests power tariff hike only by 2019

    The Union Power Ministry’s UDAY scheme which Kerala has finally joined does not anticipate any increase in power tariffs during 2017 or 2018.
    UDAY – short for Ujwal DISCOM Assurance Yojana (UDAY) – expects a five-per cent hike in tariffs only in 2019, according to the tripartite agreement signed by the Power Ministry, Kerala government and the KSEB. The Central scheme recommends a hike only by 2019 at a time when domestic tariffs in the state are set to go up by an average 30 paise per unit this month.
    UDAY is a debt-relief scheme designed to bail out loss-making power distribution companies, but the state government had dithered in signing up as it would have to take over the KSEB’s debts. Although the agreement was signed in early March, it has not been publicised yet.

    In suo motu determining tariff revision, the state electricity regulatory commission had found a revenue surplus of Rs 740 crore for the KSEB during 2017-18, but ‘truing up’ its finances for 2011-12 and 2012-13, the commission finally concluded there was a revenue gap, and hence, the need for a revision. However, under UDAY, the past debts of state-run utilities have to be taken over by the government.
    UDAY lists out certain duties for Central and state governments and the KSEB. The state government has to review the KSEB’s performance every month. It has to ensure banks and financial institutions do ‘’not advance short-term debt to the KSEB for financing losses.’’ Outstanding power bill dues from state government departments are to paid up by March 31, 2019. The government will also improve the efficiency of KSEB’s power generation units.

    The KSEB must slash technical and commercial losses in power distribution to 11 per cent by 2019. It should launch a ‘name and shame’ campaign to check power theft, introduce proper electricity metering including smart metering, energy audits and ensure electrification of all households by 2017. It should also file tariff petitions on time before the commission.

    On its part, the Centre will facilitate coal linkages for the state. It will also take steps to quickly complete the construction of inter-state transmission lines.
    The tripartite agreement was signed by joint secretary Arun Kumar Verma on behalf of the Power Ministry, Additional Chief Secretary Paul Antony on behalf of the state government and KSEB CMD K Elangovan. On paper UDAY is optional, but the Centre had set a condition which said states which fail to meet ‘operational milestones’ would lose claim on grants provided under Central schemes for improving power supply in urban and rural areas. Derek Carrier Womens Jersey

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