Bihar-The Sixth State To Enter Into Uday Scheme

Bihar-The Sixth State To Enter Into Uday Scheme

Bihar has become the sixth state to join the central government’s financial revival scheme for electricity distribution utilities which will give the state a benefit of ₹ 9,000 crore over the next three years.

The State Government and the distribution utilities of Bihar – North Bihar Power Distribution Company Ltd and South Bihar Power Distribution Company Ltd – signed the memorandum of understanding with the Ministry of Power on Monday.

  • UDAY(Ujwal Discom Assurance Yojana) is a tripartite memorandum between Bihar government, state Discoms and the Power ministry for the revival of debt ridden state distribution utilities to save 9000 crores.
  • Bihar is the sixth state to join this UDAY scheme
  • It is the second Non-UPA state after Uttar Pradesh to join this scheme
  • It will help the debt ridden distribution system of the state to save 9000 crores in the next 3 years
  • The total debt is of 3110 crores out of which the state government will bear 2332 crores
  • Remaining is to be distributed as Discom Bonds with interest of Rs.117 crores
  • The biggest benefits come from AT& C, transmission losses which come around 6650 Crores
  • In addition, coal reforms also contribute 1086 crores

Flash points

  • The other states in this scheme include Rajasthan, Gujarat, UP,Chattisgarh and Jharkhand
  • Minister of Power, coal and New& renewable energy- Piyush Goyal
  • Total worth of this project for all 6 states- 4 lakh crore or 33% of the total debt