Power sector reforms For Five States

22 February 2021 Current Affairs:The other five states underwent partial Power Sector Reforms and obtained additional borrowing of Rs. 2,094 crore.

♦ The states of Bihar, Goa, Karnataka, Rajasthan and Uttarakhand have successfully achieved the targets set by the Ministry of Power to reduce Aggregate Technical & Commercial (AT&C) losses, or achieved target reduction in Average Supply Costs and Average Revenue Realisation (ACS-ARR) gap.
♦ Reducing AT&C losses and ACS-ARR gap are two of the three reforms in Power Sector specified by the Department of Expenditure, Ministry of Finance.
♦ Part of the state’s additional borrowing ceiling is related to the reform of the Power Sector.
♦ States obtain permission to borrow funds equivalent to 0.05% of the Gross State Domestic Product (GSDP) to meet the state’s target to reduce AT&C losses, and obtain an additional 0.05% GSDP to meet the ACS-ARR gap target.
♦ In response to the challenges posed by the pandemic, GOI increased the state’s borrowing limit by 2% of its GSDP.
♦ Half of this special distribution is related to the citizen centric reforms by the states.

The four citizen-centric reform areas identified are:
♦ Implementation of the One Nation One Ration Card System (completed by 16 states)
♦ Ease of doing business reform (completed by 18 states)
♦ Urban Local body/utility reforms (completed by 6 states)
♦ Power sector reforms (completed by 7 state)

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