The government will be implementing the direct benefit transfer (DBT) scheme for the power sector as well. The scheme will help the government target the electricity subsidies in a better way, without any leakages.
At a press conference after a meeting of state power ministers, Power Minister Raj Kumar Singh said that DBT will be made mandatory by the law. A Mint report states this would result in further savings on government spending as opposed to blanket subsidies.
The report says that the accountability of distribution companies (discom) was also discussed at the meeting.
Any lapses in electricity supply will be penalized after March 2019.
Earlier reports also suggest that the aggregate technical and commercial (AT&C) losses due to discoms’ inefficiency would not be passed on to consumers. Singh stated that the consumers should not be asked to pay for the inefficiencies of the providers.
The proposed measures, which include curbing cross-subsidy to 20, will bring about efficiency and help improve India’s per capita power consumption to around 1,200-kilowatt-hour (kWh), one of the lowest in the world.
Singh also said that the government has kept a target for 100 percent metering, and removing human interface for metering, billing and collections.
Singh, also the minister of new and renewable energy, stated that these initiatives will be carried out in consultation with the State and Central governments.
These initiatives would ensure that consumers have a choice of electricity distributors and more reasonable prices with an increase in competition.India is running the world’s largest direct benefits transfer programme. These include the DBT on domestic cooking gas subsidy, scholarships, Mahatma Gandhi National Rural Employment Guarantee Scheme and pensions.