Projects Worth ₹308.02 Billion Approved to Strengthen Power Distribution Network

The program aims to strengthen sub-transmission and distribution networks in urban areas of the country

February 9, 2022


Projects worth ₹308.02 billion (~$4.12 billion) have been approved to date under the Integrated Power Development Program (IPDS), Minister of Power and New and Renewable Energy, R.K. Singh, said in the Rajya Sabha.

The central government launched the IPDS Program in 2014 to strengthen sub-transmission and distribution networks in urban areas of the country. The program also helped achieve the metering of transformers, feeders, and consumers in the urban areas.

The government also intended to execute information technology enablement works, enterprise resource planning, smart metering, gas-insulated substations, and real-time data acquisition systems with this program.

The Government of India provided a total grant of ₹193.22 billion (~$2.58 billion) for these projects. Of this, it has already released ₹167.17 billion (~$2.23 billion) to states and union territories.

Under the program, the central government will provide a 60% grant for projects to states and 85% for special category states. It will also provide additional funding of 15% for states and 5% for special category states for the achievement of milestones.

The central government funding under the Integrated Power Development Program is intended to reduce technical and commercial losses. It also allocated funds for underground cabling and aerial bunched cables and metering, which helped distribution companies balance their costs.

In August 2021, the power minister replying to a question in the Rajya Sabha had said that the Aggregate Technical & Commercial (AT&C) losses at the all India level had reduced from 23.70% in financial year (FY) 2015-16 to 21.83% in FY 2019-20, a 2% reduction in five years.

Singh informed the Rajya Sabha that the system strengthening and distribution projects covering 547 circles in 33 states and union territories were taken up under the program. Out of these 547 circles, the distribution system strengthening works in 544 circles have been completed.

In July 2021, the Ministry of Power issued detailed guidelines for a reform-based result-linked power distribution program over the next five years.

The program aims to improve the quality and reliability of power supply to consumers through a financially sustainable and operationally efficient distribution sector. The plan is to reduce aggregate technical and commercial losses across India to 12-15% and eliminate the gap between the average supply cost and the aggregate revenue requirement by 2024-25.

Thereafter, the Ministry informed that 39 out of 55 power distribution companies submitted their draft proposal under the ₹3.03 trillion (~$40.82 billion) reforms-based result-linked power distribution program. The Ministry said Meghalaya and Assam were the frontrunners in planning operational and financial reforms.