Programme Promise: Government schemes aim to improve sector parameters and performance

Government schemes aim to improve sector parameters and performance

Over the past couple of years, several government schemes have been introduced in the power sector with the aim of ensuring 24×7 quality and reliable power supply to all. The latest among these is the Pradhan Mantri Sahaj Bijli Har Ghar Yojana (Saubhagya), launched on September 25, 2017, which has set an ambitious target of 100 per cent household electrification by March 2019. Industry observers say that the scheme’s targets are ambitious; however, it is expected to positively impact the power sector by increasing incremental power demand through enhanced energy access.

Meanwhile, one of the most ambitious schemes so far, the Ujwal Discom Assurance Yojana (UDAY), which was launched in November 2015, has already begun to show results. An improvement in the financial performance of discoms by lowering the interest burden and a reduction in aggregate technical and commercial (AT&C) losses have been some highlights of the scheme so far.

Some of the other government schemes in the power sector are the twin distribution schemes – the Integrated Power Distribution Scheme (IPDS) and the Deendayal Upadhyaya Gram Jyoti Yojana (DDUGJY) for improving sub-transmission and distribution networks in urban and rural areas respectively; the National Smart Grid Mission (NSGM) for promoting smart grid initiatives; and the national LED distribution programme UJALA.

Indian Infrastructure gives a snapshot of the achievements so far and the current status of these initiatives…


The Saubhagya scheme was launched with the aim of providing electricity to every willing household in rural and urban areas by March 2019. The scheme aims at providing last-mile connectivity to individual households, as against village electrification targeted under older electrification schemes. Saubhagya entails a total outlay of Rs 163.2 billion, including a gross budgetary support of Rs 123.2 billion. There is no upfront allocation of funds and the projects will be sanctioned on the basis of detailed project reports submitted by discoms. Under the scheme, a total of 31.8 million households are proposed to be electrified across 21 states, which have submitted letters of intent.

In terms of progress, 4.35 million households have been reported to be electrified under the scheme as of April 12, 2018. This represents about 11.74 per cent of the total households that were unelectrified at the time of the launch of the scheme. The states of Goa, Punjab, Puducherry, Tamil Nadu, Gujarat and Andhra Pradesh have achieved 100 per cent household electrification.Meanwhile, Odisha (63 per cent), Nagaland (61 per cent), Assam (56 per cent), Uttar Pradesh (55 per cent) and Jharkhand (47 per cent) have the lowest household electrification levels.


Under UDAY, 27 states and five union territories (UTs) have signed MoUs with the central government. While 16 states and UTs have signed MoUs for overall improvement, 15 have joined the scheme only to improve the operational performance of their discoms. As of April 12, 2018, UDAY bonds totalling Rs 2.32 trillion have been issued. This is around 86 per cent of the total bonds worth Rs 2.69 trillion envisaged to be issued under the scheme.

Overall, UDAY has managed to improve the financial performance of the discoms to some extent. The power minister recently informed the Lok Sabha that the financial losses of the UDAY discoms reduced from Rs 515.9 billion in 2015-16 to Rs 348.27 billion in 2016-17.

As per the UDAY dashboard (accessed on April 12, 2018), for participating states, AT&C losses stood at 21.48 per cent as against pre-UDAY loss levels of 26 per cent. AT&C losses (for discoms under UDAY) were 24 per cent in 2015-16 and 20.2 per cent in 2016-17. The average cost of supply-average revenue realised (ACS-ARR) gap stood at Re 0.29 per unit as per the latest UDAY data. The gap was Re 0.59 per unit in 2015-16 and Re 0.45 per unit in 2016-17.

Meanwhile, with respect to progress on metering targets, 100 per cent feeder metering has been achieved in rural and urban areas while 57 per cent and 50 per cent distribution transformer metering has been achieved in rural and urban areas respectively. For smart metering, the progress has been tardy, with 3 per cent smart metering achieved above the 500 kWh level while between 200 kWh and 500 kWh it is only 1 per cent.


Launched in 2014, the IPDS aims to provide quality and reliable 24X7 power supply in urban areas. As of April 12, 2018, a total of Rs 284.72 billion has been sanctioned under the scheme. This includes a government grant of Rs 176.54 billion, of which Rs 49.87 billion has been released. Of the total sanctioned outlay, Rs 266.37 billion is for system strengthening of the sub-transmission and distribution (T&D) network in 3,618 towns across 500 circles; Rs 9.66 billion is for information technology (IT) enablement of discoms; Rs 6 billion is for enterprise resource planning; and Rs 2.69 billion is for smart metering.

As of February 2018, under T&D network strengthening, 25 per cent of the infrastructure sanctioned under the scheme has been erected. Among the states, while Andhra Pradesh, Gujarat, Tripura and Uttar Pradesh have set up over 40 per cent of the sanctioned infrastructure, the Andaman & Nicobar Islands, Arunachal Pradesh, Delhi, Goa, Himachal Pradesh, Jammu & Kashmir, Puducherry and Sikkim have not commissioned any physical infrastructure.

On the feeder monitoring front, as of April 2018, of the 34,050 feeders, around 31,685 (93 per cent) are being monitored on the national power portal. For registering consumer complaints, 49 public discoms and 11 private discoms have made the short code 1912 operational.

Under the erstwhile Restructured Accelerated Power Development and Reforms Programme (now subsumed under the IPDS), Rs 53.75 billion had been sanctioned (Rs 35.25 billion disbursed) across 1,405 towns for IT Part A; Rs 12.51 billion was sanctioned (Rs 4.46 billion disbursed) for supervisory control and data acquisition (SCADA) Part A across 59 towns; and Rs 308.97 billion (Rs 64.91 billion disbursed) across 1,227 towns for distribution Part B. In terms of physical progress, go-live status has been achieved in 1,376 towns of the total 1,405 towns. Further, SCADA has been deployed in 52 of the 59 towns, and is operational in 25 towns. System strengthening Part B has been completed in 1,113 towns.


Launched along with the IPDS in December 2014, the DDUGJY targets the electrification of all villages and the strengthening of sub-T&D infrastructure in rural areas. As of February 2018, 636 projects worth Rs 413.53 billion have been sanctioned under the scheme, of which Rs 54.53 billion has been released.

On the village electrification front, a significant milestone was achieved under the scheme on April 28, 2018, with 100 per cent electrification of villages in the country. Leisang village in Manipur was the last village to be electrified. Following this, only 1,305 villages that are uninhabited or are under grazing land are unelectrified.


Launched in May 2015 to provide an overarching framework for smart grid activities in the country, the National Smart Grid Mission (NSGM) currently has four smart grid projects under implementation in the country. These are in Chandigarh, Amravati (Maharashtra), Congress Nagar (Maharashtra) and Kanpur (Uttar Pradesh) and entail functionalities such as the deployment of advance metering infrastructure, outage management systems, demand response systems, etc. The total cost of these projects is estimated to be around Rs 5.77 billion including support of Rs 1.73 billion from the central government.

National LED Programme

The National LED Programme was launched in January 2015 with the aim of promoting the use of efficient lighting technology at affordable rates. The programme has two components – Unnat Jyoti by Affordable LED for All (UJALA) to provide LED bulbs to domestic consumers with a target to replace 770 million incandescent bulbs with LED bulbs, and the Street Lighting National Programme (SLNP) to replace 13.4 million conventional street lights with smart, energy efficient LED street lights by March 2019.

Under UJALA, as of April 12, 2018, the total number of LED bulbs distributed across 34 states/UTs was about 295.74 million. The resultant energy savings are estimated to be around 38 billion units per year and cost savings around Rs 154 billion. Meanwhile, under the SLNP, 5.52 million conventional street lights have been replaced with LED street lights resulting in energy savings of 270.49 kWh per light per year.


Net, net, significant progress has been achieved under various government schemes with regard to the expansion of electrification coverage, strengthening of T&D networks, adoption of energy efficient lighting solutions, lowering of AT&C losses, etc. Going forward, it is essential to fast-track the award of projects and closely monitor them to ensure timely implementation and to achieve the desired outcome within strict timelines.