Highlights of Power Distribution Companies Debt Restructure Plan

New Delhi, Nov 6: The government on Thursday approved a mega financial revival plan for the power distribution companies involving states, banks, electricity generation firms and Coal India.

The salient features of the mega revival plan — Ujwal Discom Assurance Yojna (Uday) which will help power distribution companies restructure outstanding debt of Rs.4.30 lakh crore are:-

— States to take over 75 percent of Discoms debt by 2016-17.

— Remaining debt to be converted into loans with marginal interest rate

— Debt not be included as fiscal deficit of state governments

— States to issue open market bonds to banks holding the debt

— States shall take over the future losses of Discoms

— States accepting Uday to be given priority funding

— States accepting Uday to be supplied with additional coal at notified prices

— Rs.4.30 lakh crore debt to be restructured through Uday

— Banks advised not to give further loans to loss making discoms

— Discoms to comply with the renewable purchase obligation (RPO)

— Uday to allow Discoms to break even in the next 2-3 years

— Strict monitoring mechanism set up for Uday

— Uday to improve operational efficiencies of Discoms

— Reduce cost of power

— Uday to see increased supply of cheaper domestic coal

— Coal linkage rationalisation and liberal coal swaps

— Supply of washed and crushed coal

— Faster completion of transmission lines

— Uday described as major step for providing 24X7 power for all. (IANS)