Sikkim joins Uday discom debt restructuring scheme
New Delhi, Feb 23 (IANS) Sikkim on Thursday became the 22nd state to join the central governments Ujwal Discom Assurance Yojna (Uday) debt restructuring scheme for electricity distribution companies, an official statement here said.
“Sikkim would derive an overall net benefit of approximately Rs 481 crore through UDAY by way of cheaper funds, reduction in AT&C (aggregate technical and commercial) and transmission losses, interventions in energy efficiency, etc. during the period of turnaround,” said a Union Power Ministry release.
Under Uday, a state government agrees to take over 75 per cent debt of its distribution company. The scheme provides for the balance debt to be re-priced or issues as state guaranteed discom bonds at coupon rates around 3-4 per cent less than the average existing interest rate.
In the case of Sikkim, the statement said that the reduction in AT&C losses to 15 per cent and transmission losses to 3.5 per cent is likely to fetch additional revenue of around Rs 453 crore.
“Demand Side interventions in Uday such as usage of energy-efficient LED bulbs, agricultural pumps, fans and air-conditioners and efficient industrial equipment would help in reducing peak load, flatten load curve and thus help in reducing energy consumption in the state of Sikkim.
“The gain is expected to be around Rs 25 crores,” it said.
“The central government would also provide incentives to the state government for improving power infrastructure in the state and for further lowering the cost of power,” it added.