| Work Detail |
In a significant development for India’s power sector, the Union Minister for Power and New & Renewable Energy, Shri R. K. Singh, unveiled the 12th Edition of the Integrated Rating for Electricity Distribution Companies (DISCOMs) in New Delhi on March 11, 2024. This annual exercise, crucial for evaluating the performance and efficiency of DISCOMs across the country, has shown a noticeable improvement in their overall performance for the fiscal year 2022-23. During the announcement event at Shram Shakti Bhawan, Minister Singh commended the DISCOMs for their progress and highlighted the importance of such ratings for ensuring transparency and encouraging improvement in the sector. He noted an increase in the number of DISCOMs achieving the A+ rating, from 12 in the previous edition to 14 in this year’s evaluation, indicating a positive trend towards efficiency and reliability in power distribution. Conversely, the count of C-rated DISCOMs has halved, from 32 to 17, showcasing a significant improvement in operational standards. The Minister pointed out a decline in Aggregate Technical & Commercial (AT&C) losses and an increase in billing efficiency, attributing these successes in part to the implementation of smart prepaid meters. He also expressed concern over the performance of DISCOMs in some developed and rapidly developing states, underscoring the critical role of the power sector’s viability for economic growth and avoiding load shedding and deindustrialization. Singh further addressed the issue of rising power prices, attributing it to many DISCOMs’ reliance on short-term power purchases due to a lack of long-term Power Purchase Agreements (PPAs). The government is encouraging DISCOMs to secure at least 85% of their electricity requirements through long-term agreements, introducing Resource Adequacy Rules to ensure reliability and affordability in power supply. The 12th edition of the Integrated Rating evaluated 55 electricity distribution utilities, assigning the top rank of A+ to 14 utilities, including two private utilities, TPNODL (Odisha) and DNHDDPDCL (Dadar, Nagar & Haveli, Daman & Diu), which were not included in the main ranking due to their operational tenure. Notably, utilities from Gujarat, Haryana, Karnataka, Madhya Pradesh, and Andhra Pradesh achieved high ratings of A+ or A, reflecting their commendable performance. Additionally, the Thrissur Corporation Electricity Department (TCED) of Kerala stood out among state power departments, securing the top position with an A rating. The power departments of New Delhi Municipal Council, Puducherry, Goa, and Nagaland also received favorable ratings, demonstrating effective management and operations. Key findings from this edition include a reduction in AT&C losses to 15.4%, an improvement in billing efficiency to 87.0%, and a high collection efficiency of 97.3%. The reduction in late payment surcharges and more effective management of payables and receivables were highlighted as significant achievements. Despite these advancements, challenges such as an increase in the Average Cost of Supply (ACS) and Aggregate Revenue Requirement (ARR) gap to 55 paise/kWh were noted, emphasizing the need for continued efforts towards financial sustainability and operational excellence in the sector. |
