India Seeks Better Power Distribution With New Scheme Launched By PM Modi

India is celebrating 75 years of independence this year, with the "Azadi ka Amrit Mahotsav" reminding us, at every given opportunity, that we have much to be grateful for, as our country crosses the Diamond jubilee of freedom. But even quarter of a century later, consumers in a large part of India still live without 24x7 electricity. It is to this effect that on July 30th, Prime Minister Narendra Modi

launched a $38.4 billion "Revamped Distribution Sector Scheme" (RDSS) to revive the limping power distribution system in the country. The aim is to boost the electricity distribution and make it robust for coming years, for every Indian household, however remotely it may be located. The plan, which was approved by the Union cabinet about a year ago, will focus on revamping the infrastructure, seeking to bring down losses due to transmission and distribution loopholes. According to the Power Ministry, the scheme will bolster "the operational efficiencies and financial sustainability" of the Indian electricity distribution companies. The Ministry will also provide financial assistance to the distributors subject to parameters of operational progress. The assistance would remain available until March 2026. Speaking at the "Ujjwal Bharat – Power @2047", after he launched the revamp plan, PM Modi said, "The strength of the energy sector is also important for Ease of Doing Business and is equally important for Ease of Living." He emphasised that both energy and power sectors were going to be instrumental in pushing India's growth in the next 25 years. The predominantly state-owned distributors are said to be the weakest link in the power supply chain, with Rs 1.05 trillion in outstanding payments to utilities being a major sore point. In this regard, PM Modi also urged the states on Saturday to pay off debts owed to the power supply companies so that the energy sector could be made more sustainable. Commercial as well as technical losses incurred within the power distribution system create a huge gap between the cost of supply and revenue earned. This difference continues to be wide because of inherent delays in addressing these structural as well as managerial deficiencies. All this has contributed to the sub-optimal performance of power distribution network in the country. The situation continues to be equally dismal across the states. By 2024-25, the RDSS is expected to cut all-India losses in the distribution network down to 12-15% and reduce the cost-revenue gap to absolute zero. Along with that, in order to create a financially stable and efficient distribution sector, the scheme will also improve upon the quality, reliability and affordability of the power supply system. The Rural Electrification Corporation and Power Finance Corporation have been selected as the nodal agencies for implementation of this scheme, which will work in two parts – Part 1 – Financial support for installation of pre-paid smart meters and upgrading of distribution infrastructure. Part 2 – Providing training and capacity-building to ancillary activities.