Revamped Distribution Sector Scheme

• The Union Cabinet has approved a Reforms-based and Results-linked, Revamped Distribution Sector Scheme.
• The Scheme will have an outlay of Rs.3,03,758 crore with an estimated GBS from Central Government of Rs.97,631 crore.
• The scheme envisages the provision of conditional financial assistance to DISCOMs for strengthening supply infrastructure by providing conditional financial assistance.

Scheme Objectives

• Reduction of AT&C losses to pan-India levels of 12-15% by 2024-25.
• Reduction of ACS-ARR gap to zero by 2024-25.
• Developing Institutional Capabilities for Modern DISCOMs
• Improvement in the quality, reliability, and affordability of power supply to consumers through a financially sustainable and operationally efficient Distribution Sector.

Implementation:

• The scheme will be available till 2025-26.
• REC and PFC have been nominated as nodal agencies for facilitating implementation of the Scheme.
• Implementation of the Scheme would be based on the action plan worked out for each state rather than a “one-size-fits-all” approach.

Key features:

• It provides for annual appraisal of the DISCOM performance against predefined and agreed upon performance trajectories including AT&C losses, ACS-ARR gaps, infrastructure upgrade performance, consumer services, hours of supply, corporate governance, etc.
• It is proposed that the currently ongoing Schemes of IPDS, DDUGJY along with PMDP-2015 for the Union Territories of Jammu & Kashmir (J&K) and Ladakh would be subsumed in this Scheme,
• The Scheme has a major focus on improving electricity supply for the farmers and for providing daytime electricity to them through solarization of agricultural feeders.
• It is to enable consumer empowerment by way of prepaid Smart metering to be implemented in Public-Private-Partnership (PPP) mode.

• 25 crore Smart meters are planned to be installed during the Scheme period,
• Agricultural connections would be covered only through Feeder Meters.
• There is time-bound implementation of prepaid Smart metering for consumers
• Artificial Intelligence would be leveraged to analyze data generated
• DISCOMs can avail of an additional special incentive of 50% of the aforementioned grants if they install the targeted number of Smart meters by December, 2023.

Major components:

• Consumer Meters and System Meters
• Prepaid Smart Meters for all consumers except Agricultural consumers
• 25 crore consumers to be covered under prepaid Smart metering
• Feeder Segregation
• Modernization of Distribution system in urban areas
• Rural and Urban area System strengthening