The Centre is all set to move ahead with its asset monetisation plans and is expected to gather Rs 70,000 crore through monetisation of assets of state-controlled power giants such as Power Grid, NTPC and REC (formerly Rural Electrification Corp. in the next five years. Further, about 50 per cent of funds are likely to go into bolstering state transmission and distribution infrastructure.
Citing an unnamed senior government official, as per a report that intra-state power transmission, sub-transmission and distribution networks are mostly underinvested, leading to massive technical losses and power outages.
The proposed investment is over and above the Rs
3.03 lakh crore power distribution firm reform scheme for the revival of the power distribution sector in India.
In June this year, the Union Cabinet gave the green signal for a Rs 3.03 lakh crore result-linked power distribution scheme, under which state power distribution companies would receive grants each year only if they reach the targets agreed for the previous financial.
“If transmission losses at the state level are at an average of 3 per cent, the losses at 33 kV (kilovolt) lines are as high as 9-10 per cent. There has been no emphasis on building, strengthening and upgrading intra-state transmission and distribution network by the states. All the investment being made in generation and inter-state transmission system would go waste if we do not invest in last-mile connectivity. The recent Punjab power crisis is an example,” the report quoted the official as saying.
It is important to note that Punjab saw an unprecedented power crisis last month, and it led to a temporary end of manufacturing units as the state did not have sufficient intra-state transmission capacity to import electricity. The power shortage comes at a time when the country has a surplus power capacity.
Power Grid Corporation of India, NTPC Ltd (formerly National Thermal Power Station) and REC Ltd would raise Rs 70,000 crore funds through monetising their operating projects, as per the government proposal.
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