Report of Indian Institute of Public Administration ... - Ministry of Power

State Reports (Vol.-III)
Study on `Impact of Restructuring of SEBs’
• Providing moratorium on payment of interest on outstanding Government of
Gujarat loan of Rs 842 crore for the period 2005-06 to 2010-11. Deferred interest
to be paid after 2010-11;
• Subsidy has been capped at Rs 1,100 crore till review after 95 per cent of
completion of Jyoti Gram Yojna. Thereafter, this cap will be removed and
subsidy will be computed as per formula of agricultural subsidy. However,
subsidy will be capped at the amount of electricity duty collected during the year
(which presently is more than Rs 1,600 crore).
• Government of Gujarat to provide capital grant of Rs 250 crore per year for
strengthening the power sector; and
• Government of Gujarat/profit making State PSUs to provide capital support of
around Rs 600 crore per year.
The above commitments from Government of Gujarat for the period 2006 to 2011
translate into:
• A total revenue support of Rs 9,498 crore; and
• A total capital support of Rs 5,854 crore;
The total revenue and capital during the above-mentioned period would thus be Rs
15,352 crore, i.e., approximately Rs 2,558 crore per year.
Improvements to be Achieved by the Companies, as Indicated in the FRP
The restructured entities need to improve their efficiency parameters like reduction in
power purchase costs, fuel costs, general purchase costs, interest costs, aggressive
reduction in T&D losses and bring about improvement in generation efficiency, etc. It
is proposed to bring down T&D losses from 29.79 to 18.5 per cent and improve
overall generation efficiency from 72 to 76 per cent. The total savings envisaged
during the period 2006 to 2011 are indicated below:
Targets to be Accomplished (As per FRP)
Particulars
(Rs crore)
Savings in costs
Power purchase cost reduction 1,761.00
Reduction in general purpose costs 84.00
T&D loss reduction 3,661.00
Improvement in generation efficiency 510.00
Fuel cost reduction 869.00
Reduction in interest costs 4,024.00
Total savings envisaged 10,909.00
Average savings per year 1,818.00
9.8