Lok Sabha Question No. 3099 (UNSTARRED), answered on 2023-12-21
Subject: Implementation of the Ujjwal DISCOM Assurance Yojana
Ministry: POWER
Asked by: D. M. Kathir Anand

## GOVERNMENT OF INDIA MINISTRY OF POWER LOK SABHA UNSTARRED QUESTION NO.3099

## ANSWERED ON 21.12.2023

## IMPLEMENTATION OF THE UJJWAL DISCOM ASSURANCE YOJANA

3099. SHRI D.M. KATHIR ANAND:

Will the Minister of POWER be pleased to state:

- (a) whether  according  to  the  C&AG's  report,  the  implementation  of  the  Ujjwal DISCOM  Assurance  Yojana  (UDAY)  in  Tamil  Nadu  Generation  and  Distribution Corporation (TANGEDCO) between 2016-17 and 2019-20 has not helped TANGEDCO to improve its finances as its debt has gone up from Rs. 81,312 crore in September 2015 to Rs. 1.23 lakh crore on March 2020;
- (b) if so, the details thereof and the reasons therefor;
- (c) whether the Government proposes to provide additional financial support to TANGEDCO  for  the  completion  of  its  power  projects  at  North  Chennai  Stage-III, Kunda and Udangudi and if so, the details thereof; and
- (d) the total amount extended as loans to TANGEDCO by the Union Government from June 2021 onwards?

## A N S W E R

THE MINISTER OF POWER AND NEW & RENEWABLE ENERGY

(SHRI R.K. SINGH)

(a) & (b) : UDAY was launched  with  an  overall  aim  of  operational  and  financial turnaround  of  State  owned  Distribution  Utilities  (DISCOMs)  through  efficiency improvements  and  financial  restructuring.  As  a  result,  State  Power  Distribution Utilities reported improvements which include reduction in Aggregate Technical & Commercial (AT&C) losses from 23.66% in FY2017 to 20.93% in FY2020. Similarly, AT&C  losses  of  Tamil  Nadu  Generation  and  Distribution  Corporation  Limited (TANGEDCO) reduced from 18.23% in FY2017 to 13.60% in FY2020 and preliminary report shows that losses of TANGEDCo have further reduced to 10.23% in FY2023.

Recognising  that  the  liabilities  of  the  State  owned  Utilities  are  the contingent liabilities of the States themselves, UDAY envisaged the States taking over  of  75%  of  the  debt  of  the  DISCOMs  as  on  30.09.2015  by  issuing  State Development Loan (SDL) Bonds.   The UDAY Memorandum of Understanding (MoU) for

Tamil Nadu was signed on 9th January, 2017. As per the MoU, the outstanding debt of  TANGEDCO was Rs 81,312 Crores at the end of September 2015 out of which DISCOM  debt was  Rs 30,420 Crores while the remaining corresponded to Generation business. Government of Tamil Nadu (GoTN) was to take over 75% of outstanding 'DISCOM debt' as on 30 th  September 2015 i.e. Rs 22,815 Crores during 2016-17. In line with the MoU, GoTN has taken over the DISCOM debt of Rs 22,815 Crore  by  issuing  Non-SLR  Bonds  during  FY  2016-17.  Further,  this  amount  of  Rs 22,815 Crore was transferred as Grant by GoTN to TANGEDCO progressively upto FY 2021-22. Year-wise detail given in Annexure-I.

After 2016, most of the capacity additions towards Generation and Distribution  strengthening  projects  have  been  undertaken  by  TANGEDCO  through financial  assistance  obtained  from  Financial  Institutions  and  Banks,  which  is  a reason for increase in debt.  Moreover, tariff revision has not been effected every year as per UDAY guidelines, which is also a reason for increase in debt.

Further,  as  per  MoU,  GoTN  was  to  takeover  future  losses  of  TANGEDCO  in graded manner till FY 2020-21. As against the target of Rs 10,132 Crores, GoTN took over losses of Rs 9,366 Crores till FY 2021-22. Year-wise detail given in Annexure-II. Furthermore, Government of Tamil Nadu has consented to take over 100% losses of TANGEDCO of the current year, during the next year from the FY 2021-22 onwards. Accordingly the losses of TANGEDCO for the FY 21-22 has been taken over to the tune of Rs.11,954.64 Cr during the FY 2022-23.

## (c) : Details  of  loans  sanctioned  to  TANGEDCO  by  REC  Ltd.  for  North  Chennai Stage-II TPS, Kunda HEP and Udangudi TPS project are tabulated below:-

| Sr. No.   | Name of the project           | Original Loan amount sanctioned by REC (Rs. In Cr.)   | Additional loan amount (Rs. In Cr.)   |
|-----------|-------------------------------|-------------------------------------------------------|---------------------------------------|
| 1)        | North Chennai Stage - III TPS | 5,006.99                                              | 1,036.75 (sanctioned by REC)          |
| 2)        | Kunda HEP                     | 1,450.00                                              | 1,270.82 (sanctioned by REC)          |
| 3)        | Udangudi TPS project          | 10,453.00                                             | Proposal under consideration with PFC |

## (d): The  details  of  loans  sanctioned  to  TANGEDCO  from  the  central  financial institutions from June, 2021 are below:

| 1.    | REC Ltd                              | Rs.24,090 Crore   |
|-------|--------------------------------------|-------------------|
| 2.    | Power Finance Corporation (PFC) Ltd. | Rs.17,121 Crore   |
| Total | Total                                | Rs. 41,211 Crore  |

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ANNEXURE-I ANNEXURE REFERRED IN REPLY TO PARTS (a) & (b) OF UNSTARRED QUESTION

NO. 3099 ANSWERED IN THE LOK SABHA ON 21.12.2023 **************

Table (1): Actual transfer as grant is described in the following table:-

| Year    | Total Debt to be taken Over as per MoU   | Transfer as Grant as per MoU   | Actual debt taken Over   | Actual grant   |
|---------|------------------------------------------|--------------------------------|--------------------------|----------------|
| 2016-17 | 75%                                      | 4563                           | 75%                      | -              |
| 2017-18 | -                                        | 4563                           | -                        | 4563           |
| 2018-19 | -                                        | 4563                           | -                        | 4563           |
| 2019-20 | -                                        | 4563                           | -                        | 4563           |
| 2020-21 | -                                        | 4563                           | -                        | 4563           |
| 2021-22 | -                                        | -                              | -                        | 4563           |
| Total   | 75%                                      | 22,815                         | 75%                      | 22,815         |

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## ANNEXURE-II

## ANNEXURE REFERRED IN REPLY TO PARTS (a) & (b) OF UNSTARRED QUESTION NO. 3099 ANSWERED IN THE LOK SABHA ON 21.12.2023

**************

Table (2) : Loss takeover: As per MoU, GoTN was to takeover future losses of TANGEDCO in graded manner. The actual loss takeover by GoTN is as below:

| Particulars             | Profit/(Loss) Before Tax **   | Loss to be taken over by State Govt   | Actual Loss takeover by GoTN   |
|-------------------------|-------------------------------|---------------------------------------|--------------------------------|
| 2016-17                 | (4349)                        | -                                     | -                              |
| 2017-18 @5% of PY Loss  | (7761)                        | 217                                   | 217                            |
| 2018-19 @10% of PY Loss | (12,623)                      | 776                                   | 776                            |
| 2019-20 @25% of PY Loss | (11,965)                      | 3156                                  | -                              |
| 2020-21 @50% of PY Loss | (13,407)                      | 5983                                  | 3000 ^                         |
| 2021-22                 | -                             | -                                     | 5373 ^                         |
| Total                   | (50,105)                      | 10,132                                | 9366                           |

** as per PFC Report on Annual Performance of State Power Utilities

^ as per TANGEDCO Audited Accounts for 2020-21

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