The Minister said that the new scheme would give more flexibility to the Member States as to how they want to use the funds to rekindle their discomfort.
The amount of the loan for state-run distribution companies (discoms) offered by the Center may be increased to Rs 1.25 lakh crore from Rs 90,000 crore previously designated at the request of the States, said Union Power Minister RK Singh.
The Center announced a liquidity infusion scheme to clear the discomfort due to private and central government-owned power-generating companies by March, but several states, citing additional stress from the coronavirus lockdown, want the loan to take care of their outstanding assets by June, the Minister added.
Singh spoke to the power ministers of state governments through a video conference. As of now, the sum of Rs 20,000 crore of loans under the scheme has been approved.
The Center and the States also discussed the new discomfort-recovery scheme, which will underpin existing central government schemes for the electricity sector, such as the Integrated Power Development Scheme (IPDS) and the Deen Dayal Upadhyaya Gram Jyoti Yojana (DDUGJY).
The cumulative cost of these two schemes (launched in FY15) is Rs 1.1 lakh crore.
The Minister said that the new scheme would give more flexibility to the Member States as to how they want to use the funds to rekindle their discomfort. However, these state-run entities will have to work out a loss reduction trajectory and the funds, in the form of loans and grants, would be released under this scheme only if the trajectories are followed.
The contentious issue of the proposed amendments to the Electricity Act was also discussed at the conference, after which it was decided that the current draft version of the amendments would be amended, taking into account the suggestions made by all stakeholders, including state governments. As reported earlier by FE, after several States had protested against the proposed amendments, alleging that the new provisions diluted their authority to appoint electricity regulators, the Center has begun to consider continuing with the existing framework of separate selection committees for each State.
