Union Minister of State (IC) for Power, Coal, New & Renewable Energy and Mines, Piyush Goyal presided over the signing of the Memorandum of Understanding (MOU) under the Ujwal DISCOM Assurance Yojana (UDAY) Scheme with the Government of Tamil Nadu and its Discom TANGEDCO, for operational and financial turnaround of the DISCOM, in New Delhi.
Tamil Nadu would derive an overall net benefit of approximately Rs. 11,000 crores through UDAY, by way of savings in interest cost, reduction in AT&C and transmission losses, interventions in energy efficiency, coal reforms etc.
The state also signed 24X7 Power For All document on the occasion. With Tamil Nadu joining the cause, 92% of country’s Discom debt has been covered under UDAY.
By signing the MOU under UDAY, the State Government is taking over 75% of debt of Rs. 30,420 crores of TANGEDCO.
The scheme also provides for the balance debt to be re-priced or issued as State guaranteed Discom bonds, at coupon rates around 3-4% less than the average existing interest rate.
The State would have savings of about Rs.950 cr. in annual interest cost through reduction of debt and through reduced interest rates on the balance debt.
UDAY lays stress on improving operational efficiencies of the DISCOMs.
The reduction in AT&C losses and transmission losses to 13.5% and 3.7% respectively is likely to bring additional revenue of around Rs. 1,601 crores to TANGEDCO.
