Union Budget 2021: Finance Minister Nirmala Sitharaman said that the government is working on a framework that will give electricity consumers in India a chance to choose their discoms or service providers. The framework will be presented soon. “Discoms are monopolies. There is a need to provide a choice to customers to choose a service provider (distribution company). A framework will be put in place to provide an alternative,” Sitharaman said while giving her Budget speech in the Lok Sabha on Monday.
It is to note that most of the power distribution utilities (discoms) that are there in the country at present are stated-owned. Many of them are cash strapped and therefore, not able to provide electricity 24 hours, further hindering the government’s ‘power for all’ vision.
Meanwhile, the government has proposed a Rs 3,05,982 crore outlay for the discoms that will act as a revamped reform scheme. Sitharaman in her budget speech said that the government will bring a revamped, result-linked scheme for five years for the discoms.
“The viability of distribution companies is a serious concern. A revamped, reform-based, results-linked, power distribution sector scheme will be launched with an outlay of Rs 3,05,982 crore over five years. The scheme will provide assistance to discoms for infrastructure creation, inclusion of prepaid smart metering, feeder separation, upgradation of systems,” she said.
It is to note that the earlier discom reform scheme launched by the government- UDAY concluded last year and many states could not meet their stipulated targets.