The State Power Ministers’ Conference on “Distribution Sector Reforms” derlined the need for urgent steps to arrest and reverse the growing losses in power distribution.
The Conference chaired by Union Minister of Power Sushil Kumar Shinde was attended by Power Ministers of the States from across the country. Shinde while inaugurating the conference called upon the states to take effective steps to ameliorate the poor financial condition of power distribution utilities.He further asked the states to ensure that subsidies to the electricity distribution utilities for the subsidised sectors like agriculture and rural households are released in advance and the DISCOMs are able to realise adequate tariff to not only bridge but ensure that the gap between average revenue realised and average cost of supply is positive.
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Planning Commission Deputy Chairman Montek Singh Ahluwalia expressed concern over the mismatch between tariff and cost and underlined the need to reduce AT&C losses. He suggested to seriously looking into the possibility of introducing time of the day tariff with higher tariff during peak hours and operationalisation of open access to consumers.
Planning Commission Deputy Chairman Montek Singh Ahluwalia expressed concern over the mismatch between tariff and cost and underlined the need to reduce AT&C losses. He suggested to seriously looking into the possibility of introducing time of the day tariff with higher tariff during peak hours and operationalisation of open access to consumers.
The conference adopted resolution that state governments would ensure that the accounts of the utilities are audited upto the year 2009-10 and also ensure that the accounts of a financial year are audited by September of the next financial year.
The distribution utilities file their Annual Tariff Revision Petition every year, by December – January of the preceding financial year to the State Regulators keeping in view the increase of the Power purchase cost and states will ensure that the difference between ARR and ACS is not only bridged but is positive to generate internal surpluses which can be used for network expansion and maintenance.
The state governments would ensure automatic pass through in tariff for any increase in fuel cost by incorporating the same in the regulations and state governments would not only clear all the outstanding subsidies to the utilities, but ensure advance payment of subsidy.
The state governments would take effective steps to reduce AT&C losses to less than 15% by administrative measures, curbing pilferage of electricity and by setting up special police stations and special courts to deal exclusively with power theft related cases, if not done already. States would immediately initiate steps to appoint distribution franchises in urban areas through competitive bidding.
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