Scindia, state ministers discuss challenges in power sector

Meeting

The government has begun talks with representatives of various states to streamline and remove hurdles in the power sector for higher generation.

Power Minister Jyotiraditya Scindia is holding a day-long meeting with the energy ministers and senior officials of various states to discuss the issues confronting the sector and measures to resolve them.

"We are here to deliberate upon the challenges in the power sector," Scindia said while addressing a gathering of various stakeholders in the sector.

The central ministry along with the states will, among other things, discuss the issue of tariff revision, financial health of the electricity distribution companies and

challenges in power transmission.

"Intra-state transmission, last year's grid failure, financial restructuring package of discoms, among other issues, will be discussed today," Power Secretary P Uma

Shankar said.

The other diginatories attending the meeting include heads of the PSUs and state energy secretaries.

The ailing health of the state electricity boards is a cause of worry for the sector and will be a prominent area of discussion in today's meet.

In September, last year, the Cabinet approved Rs 1.9 lakh crore debt restructuring package for the power discoms.

Under the scheme approved by the Cabinet Committee on Economic Affairs, 50 percent of the short-term outstanding liabilities would be taken over by state governments.

The balance 50 percent loans would be restructured by providing moratorium on principle and best possible terms for repayments.

As part of mandatory conditions, 50 percent of the outstanding liabilities up to March 31, 2012 is to be taken over by the state governments.

The liabilities shall be first converted into bonds to be issued by discoms to participating lenders, duly backed by the state government's guarantee.

The deadline for the scheme has now been extended to March

31, 2013, from the earlier date of December 31, 2012. It is effective from the date of notification.

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