Bihar-The Sixth State To Enter Into Uday Scheme

Bihar-The Sixth State To Enter Into Uday Scheme

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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.

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  • 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