Summer power outages could end soon and electricity bills could come down, if all state governments adopt the Ujwal Discom Assurance Yojana or UDAY — a scheme to restructure the debt of state power utilities, minister for power, coal and renewable energy Piyush Goyal told HT in an interview. Excerpts.
You promised 24x7 power when you took office in 2014. When do we see this happening?
We had promised power for every home and sufficient power for farmers and the industry by 2022. Having completed two years and the successes we have seen in the energy sector, I feel empowered to say that we will achieve our target of power for all by 2019. I like to set aggressive targets, without them you will get ordinary performances.
What will be the power situation this year in peak summers?
Indians have become very demanding. Gone are the days where you could get away with power outages. Better distribution infrastructure along with the fact that we are saving over 30-million units of power daily by switching to energy-efficient appliances will ensure that summer-time outages are a thing of the past. Coal shortage that led to power cuts has also been tackled. In 2014, 66% of coal plants were facing scarcity, today these plants have 29 days of stock.
How are states managing to keep politics out of UDAY?
It is a legal agreement and all states are coming on board. Power reforms always meant increase in tariffs, but UDAY for the first time looks at the whole ecosystem of the sector, and finds that efficiency improvements can actually turn around the sector without stressing the consumers with higher bills. We are already seeing tariffs come down. Gujarat has reduced tariffs by 25 paise a few days back and this will become the norm, soon. Politics is involved when you don’t tackle inefficiency and burden people with higher tariffs. And the government is supporting the states, which are taking steps to unburden people.
What are the risks of discom debt turning bad and public banks losing the money?
UDAY is meant for financial and operational turnaround of discoms. So under the financial part, the initiative is to bring down borrowing costs from 12% to 8% and moving 75% of the discom debt to states. No discom will make losses by 2018-2019 and states will have to fund them if there are any losses. Hence, through UDAY, discoms will ensure that these loans don’t turn bad.
Have you quantified the employment generation potential of the reforms in the sector?
Ans: The solar projects along with the our push towards manufacturing in India has the potential to create one million jobs. If we look at the whole power sector along with coal mining, we have the capacity to create over two million direct and indirect jobs.
Several successful bidders at the coal auctions claim they cannot mine commercially at the rates they committed?
Bidding is a private company’s own decision. Since most of you are in favour of private enterprise and privatisation, they should have made their calculations and done their math better than the government companies.