Aim:

Launch date: 05th November 2015&nbsp;
Launch by: Prime Minister Shri Narendra Modi&nbsp;

Objective of this Scheme:

This scheme empowers DISCOMs with the opportunity to break even in the next 2-3 years through four initiatives.
- Improving operational efficiencies of DISCOMs.
- Reduction of cost of power.
- Reduction in interest cost of DISCOMs.
- Enforcing financial discipline on DISCOMs through alignment with State finances.
Through some measures, reduction in cost of power would be achieved such as:
- Increased supply of cheaper domestic coal,
- Coal linkage rationalization,
- Liberal coal swaps from inefficient to efficient plants,
- Coal price rationalization based on GCV (Gross Calorific Value),
- Supply of washed and crushed coal,
- Faster completion of transmission lines.
States will take over three-fourths of the debt of their respective discoms, Under the scheme.
Remaining 25 per cent of the discom debt will be dealt by –
- Conversion into lower interest rate loans by the lending banks.
- Or be funded by money raised through discom bonds backed by State guarantee.
Backing from the State will help bring down the interest rate for the discoms.
For the bailout, in return, the discoms have been given target dates (2017 to 2019) by which they will have -
- To meet efficiency parameters such as reduction in power lost through transmission, theft and faulty metering, installing smart meters and implementing GIS (geographic information system) mapping of loss making areas.
- States will also have to ensure that power tariffs are revised regularly.

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