Lok Sabha Question No. 1256 (UNSTARRED), answered on 2016-03-03
Subject: Integrated Rating Framework
Ministry: POWER
Asked by: KAVITHA KALVAKUNTLA

## GOVERNMENT OF INDIA MINISTRY OF POWER

LOK SABHA UNSTARRED QUESTION NO.1256 TO BE ANSWERED ON 03.03.2016

INTEGRATED RATING FRAMEWORK

1256.  SHRIMATI KAVITHA KALVAKUNTLA:

Will the Minister of POWER be pleased to state:

(a) the  details  of  the  methodology  adopted  with  regard  to  Integrated  Rating Framework for State Distribution Utilities;

(b) the results of the 3rd Integrated Rating exercise conducted for the year of 2014-15; and

- (c) the concrete measures taken as a result of rating exercises?

A N S W E R

THE MINISTER OF STATE (INDEPENDENT CHARGE) FOR POWER, COAL AND NEW & RENEWABLE ENERGY

( SHRI  PIYUSH GOYAL )

(a) : The  summary  of  various  parameters  adopted  with  regard  to  the rating methodology conducted during FY 2014-15 is given at Annex-I.

(b) : The results of the 3rd Integrated Rating exercise is given at AnnexII.

(c) : The ratings were adopted by Power Finance Corporation Ltd. (PFC) w.e.f 11 th  August 2015 to evaluate distribution utilities for financing, loan pricing and determining exposure limits.

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ANNEX-I ANNEX  REFERRED  TO  IN  REPLY  TO  PART  (a)  OF  UNSTARRED  QUESTION  NO. 1256 TO BE ANSWERED IN THE LOK SABHA ON 03.03.2016.

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## Summary of Rating Parameters

| Sl. No.   | Parameters                                     | Weightage   |
|-----------|------------------------------------------------|-------------|
| 1.        | Financial Performance                          |             |
| i         | Coverage Ratio                                 | 15          |
| ii        | AT&C Losses                                    | 12,-5       |
| iii       | Subsidy Support                                | 10,-10      |
| iv        | Interest Coverage Ratio                        | 5           |
| v         | Debt Equity Ratio                              | 5,-3        |
| vi        | Sustainability                                 | 9           |
| vii       | Receivables                                    | 4           |
| viii      | Payables                                       | 3,-3        |
| 2.        | Audited Accounts                               | 5,-12       |
| 3.        | Cross Subsidy                                  | 0,-2        |
| 4.        | Reform measures - Unbundling & Corporatisation | 0,-5        |
| 5.        | Regulatory Environment                         | 15,-15      |
| 6.        | Forward Looking parameters                     | 5,-1        |
| 7         | Incentive / Bonus marks                        | 12          |
|           | TOTAL                                          | 100         |

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## ANNEX  REFERRED  TO  IN  REPLY  TO  PART  (b)  OF  UNSTARRED  QUESTION  NO. 1256 TO BE ANSWERED IN THE LOK SABHA ON 03.03.2016.

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## 3 rd  Integrated Rating of State Distribution Utilities

## UTILITY-WISE GRADES

|   S.No. | Name of Utility                                               | 3 rd IR Grade   |
|---------|---------------------------------------------------------------|-----------------|
|       1 | Dakshin Gujarat Vij Company Ltd.                              | A+              |
|       2 | Madhya Gujarat Vij Company Ltd.                               | A+              |
|       3 | Uttar Gujarat Vij Company Ltd.                                | A+              |
|       4 | Paschim Gujarat Vij Company Ltd.                              | A+              |
|       5 | Punjab State Power Corporation Limited                        | A+              |
|       6 | Maharashtra State Electricity Distribution Company Limited    | A               |
|       7 | Uttarakhand Power Corporation Limited                         | A               |
|       8 | Mangalore Electricity Supply Compnay Limited                  | B+              |
|       9 | Bangalore Electricity Supply Company Limited                  | B+              |
|      10 | Chhattisgarh State Power Distribution Company Limited         | B+              |
|      11 | North Bihar Power Distribution Company Limited                | B+              |
|      12 | West Bengal State Electricity Distribution Company Limited    | B+              |
|      13 | Eastern Power Distribution Company of AP Limited              | B+              |
|      14 | Himachal Pradesh State Electricity Board Limited              | B+              |
|      15 | Madhya Pradesh Paschim Kshetra Vidyut Vitaran Company Limited | B+              |
|      16 | Southern Power Distribution Company of Telegana Limited       | B+              |
|      17 | Southern Power Distribution Company of AP Limited             | B+              |
|      18 | Assam Power Distribution Company Limited                      | B               |
|      19 | Chamundeshwari Electricity Supply Corporation Limited         | B               |
|      20 | Northern Power Distribution Company of Telangana Limited      | B               |
|      21 | Uttar Haryana Bijli Vitran Nigam Limited                      | B               |
|      22 | Kerala State Electricity Board Limited                        | B               |
|      23 | South Bihar Power Distribution Company Limited                | B               |
|      24 | Gulbarga Electricity Supply Company Limited                   | B               |
|      25 | Dakshin Haryana Bijli Vitran Nigam Limited                    | B               |
|      26 | Madhya Pradesh Poorv Kshetra Vidyut Vitaran Company Limited   | B               |
|      27 | Tamil Nadu Generation and Distribution Corporation            | B               |
|      28 | Jodhpur Vidyut Vitran Nigam Limited                           | B               |
|      29 | Madhya Pradesh Madhya Kshetra Vidyut Vitran Company Limited   | B               |
|      30 | Paschimanchal Vidyut Vitaran Nigam Limited                    | B               |
|      31 | Tripura State Electricity Corporation Limited                 | C+              |
|      32 | Ajmer Vidyut Vitran Nigam Limited                             | C+              |
|      33 | Hubli Electricity Supply Company Limited                      | C+              |
|      34 | Madhyanchal Vidyut Vitran Nigam Limited                       | C+              |
|      35 | Jaipur Vidyut Vitran Nigam Limited                            | C+              |
|      36 | Purvanchal Vidyut Vitaran Nigam Limited                       | C+              |
|      37 | Kanpur Electricity Supply Company Limited                     | C+              |
|      38 | Meghalaya Power Distribution Corporation Limited              | C+              |
|      39 | Dakshinanchal Vidyut Vitran Nigam Limited                     | C               |
|      40 | Jharkhand State Electricity Board                             | C               |

- a. Grade A+ denotes a score distribution between 80 and 100 denoting very high operational and financial performance capability.
- b. Grade  A  denotes  a  score  distribution  between  65  and  80  denoting  high  operational  and  financial performance capability.
- c. Grade B+ denotes a score distribution between 50 and 65 denoting moderate operational and financial performance capability.
- d. Grade  B  denotes  a  score  distribution  between  35  and  50  denoting  below  average  operational  and financial performance capability.
- e. Grade  C+  denotes  a  score  distribution  between  20  and  35  denoting  low  operational  and  financial performance capability.
- f. Grade C denotes a score distribution between 0 and 20 denoting very low operational and financial performance capability.

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