Shripad Naik Chairs Group of Ministers on Power Distribution

New Delhi, Jan 30 (PTI) Union Minister Shripad Yesso Naik on Thursday chaired the first meeting of Group of Ministers constituted to address issues related to viability of distribution utilities in the country, an official statement said.

The Minister of State for Power, New and Renewable Energy said discoms are the lifeline of electricity supply chain, connecting power generation to millions of homes, businesses, and industries.

"However, they face significant challenges that affect not only their financial health but also the sustainability of entire power sector value chain," Naik said in the meeting attended by senior officials from central and energy ministers of various states and state government and officials from Power Finance Corporation Ltd.

He expressed concerns about the AT&C losses that are far above the global average and the need to improve it by improving network, adopting new technologies and improving the billing and collection efficiency, the Ministry of Power statement said.

He mentioned that year-on-year gap between the average cost of supply (ACS) and the average revenue realised (ARR) is "eroding" the financial stability of the utilities that needs to be brought down.

Minister of State for Power and New and Renewable Energy is the Chairman of Group of Ministers on Viability of Distribution Utilities.

Energy Minister of Uttar Pradesh A K Sharma is member-cum-convenor, while Energy Ministers of Andhra Pradesh, Tamil Nadu, Madhya Pradesh, Rajasthan, and Maharashtra are members.

The GoM analyses debt scenario in key states, identifies parameters that need to be monitored to ensure borrowings are productive, identify states that are in urgent need for liquidity support and design a fiscal discipline program to enable them to avoid a debt trap.