Following the states and UTs that have recently submitted their investment proposals under the Revamped Distribution Sector Scheme (RDSS), ICICI Securities (I-Sec), in a recent report said that it expects more states to submit their investment proposals.
The report noted that so far 12 states and UT of Jammu & Kashmir have submitted proposals worth Rs.1.62 trillion (lakh crore) as part of the Rs.3-trillion RDSS that was approved in July 2021.
The RDSS aims to install 25 crore smart prepaid meters by March 2025 and improve/upgrade the distribution infrastructure of state discoms seeking to reduce losses, improve discoms’ operational efficiencies and financial sustainability based on state-specific action plans.
In its report, I-Sec said that it believes other states will also come on board and expedite submission of their proposals for approval by the government, since there is an additional special incentive for states that are able to install the targeted number of smart meters by December 2023.
This, as well as anticipated approvals for more states, will revive capital expenditure in the power distribution space over the implementation period of the scheme (FY23 to FY26).
Key beneficiaries include: Siemens Ltd, GE T&D India, KEC International, Techno Electric & Engineering, and Genus Power, the report said.
Approved proposals from the first set of states include Rs.877 billion for smart metering infrastructure and Rs.747 billion for infrastructure upgrade aimed at reducing AT&C losses.
Key large states include Uttar Pradesh (Rs.357 billion), Tamil Nadu (Rs.283 billion), Rajasthan (Rs.186.billion), Madhya Pradesh (Rs.182 billion), Gujarat (Rs.166 billion) and Andhra Pradesh (Rs.134 billion).
Other states include Kerala, Assam, Meghalaya, Mizoram, Himachal Pradesh and Uttarakhand, as well as the UT of Jammu & Kashmir.
The broad distribution of investment approved for distribution infrastructure and for smart metering is presented in the following table.
It may be mentioned that of RDSS’ total outlay of Rs.3038 billion, around Rs.1,500 billion will be spent towards prepaid smart metering, while another Rs.1,515 will go towards distribution infrastructure works like SCADA, DMS, aerial bunched cables, feeder segregation works, etc.
Featured photograph (source: Tata Power) is for representation only.
