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UDAY: Going to get tough for discoms, Centre may not allow losses over 15 pct to be passed on to consumers

To ensure stricter UDAY-target compliance by discoms, the government will mandate via a new law that their losses due to pilferage/theft exceeding 15 percent can’t be considered for tariff determination.

Power minister RK Singh said the move would mean additional aggregate technical and commercial (AT&C) losses arising from discoms’ inefficiency are not passed on to consumers.

The minister also said that the new tariff policy will cap cross subsidy charges at 20%, a move that would help lower industrial electricity tariffs and spur manufacturing. Discoms’ AT&C losses have come down from 26% in FY15 to around 21% now, thanks partly to the UDAY scheme launched in November 2015.

Singh said local solar firms will gain from the International Solar Alliance (ISA), which became a legal entity on Wednesday, as they will participate in projects in ISA countries. He added the Centre plans to mandate local manufacturing for projects with aggregate capacity of 20 GW to be set up till 2022, by when solar capacity is to hit 100 GW from 15 GW now.