56 A STUDY ON THE REFORMSOF ELECTRICITY SERVICES IN THE RURAL AREAS IN
MADHYA PRADESH Dr. Manoj Jain
Assistant Professor, P.M.B. Gujrati Commerce College, Indore (M.P.) 1 INTRODUCTION
Madhya Pradesh was the largest state in India and had the fourth largest population until it was bifurcated in 2000 into the two states of Madhya Pradesh and Chattisgarh. The contribution of the primary sector in state domestic product has declined gradually over time and the contribution of services and industry has risen consistently.
The 2001 census states that 97% of Rural area of MP is electrified but according to the new definition (as given below) of rural electrification its fell down to average 60-70 percent. Expanding electrification and scaling up the electricity services is critical to both the economic and social development of India.
The current state of electricity services across India can be said to be acute, if not in a crisis mode. The immediate manifestations of this crisis are severe shortcomings: (a) access to electricity for rural and urban poor, (b) generation capacity that cannot meet peak demand and (c) reliability of supply, in terms of predictability of outages and quality of power supply. The goal of this study is proposing a set of policy levels that can aggressively reform all three of these issues at once.
2 NEW DEFINITION OF VILLAGE ELECTRIFICATION (W.E.F. APRIL, 2004)
"A village will be deemed to be electrified”if basic infrastructure such as distribution transformer and distribution lines are provided in the inhabited locality (Rural and urban poor) as well as the dalitbasti/
hamlet where it exists. (For electrification through non-conventional energy sources a Distribution Transformer may not be necessary.
2.1 Rural Electrification (RE) Schemes:
Rural electrification is the backbone of rural economy and a basic input for rapid rural development. The following schemes launched for Rural electrification in the state as well as in country also.
Pradhan Mantri Gramodaya Yojna (PMGY): The PMGY launched in 2000- 2001 provided additional financial assistance for minimum services by the central government to all states on a 90%
loan and 10% grant basis. These included rural health, education, drinking water and rural electrification.
Kutir Jyoti Program (KJP): KJP was initiated in 1988-89 to provide single point light connection (60w) to all Below Poverty Line (BPL) households in the country. KJP provides 100% grant for one time cost of internal wiring and service connection charges and builds in a proviso for 100% metering for release of grants.
Minimum Needs Program (MNP): The MNP, which exclusively targeted states with less than 65% rural electrification (by the old definition),45 provides 100%
loans for last mile connectivity. The program resources are drawn from the Central Plan Assistance. Rs. 775 crore was released during 2001-03 for rural electrification under the MNP.
Accelerated Rural Electrification Program (AREP): The AREP, operational since 2002, provides an interest subsidy of 4% to states for RE programs. The AREP covers electrification of un- electrified villages and household electrification and has an approved outlay of Rs. 560 crore under the 10th Plan. The interest subsidy is available to state governments and electricity utilities on loans availed from approved financial institutions like the REC, PFC (Power Finance Corporation) and from NABARD.) 2.2 Power Sector Policy Framework:
The SDP (system development progmramme) focused on introducing policy changes in the power sector to improve its overall performance. The policy interventions that were undertaken in implementing the SDP (20012005) are integral to the SDP. It is appropriate to describe and assess these policy interventions with respect to the expected outcomes of the SDP.
57 Open access : Open access to the
transmission system is allowed in Madhya Pradesh for consumers who have contracted demand of more than 1 MW from Oct 2007, which is much earlier than the January 2009 target envisaged in the National Tariff Policy. This allows the larger consumers connected to medium-voltage or HV network to enter into commercial contracts with generators and power suppliers other than the regional DISCOM. It also enables the embedded generators in the Madhya Pradesh power system to sell their output to a buyer other than the regional DISCOM. MPSERC has already notified wheeling charges for transmission and distribution of power as well as a cross subsidy surcharge for open access.
Public-private partnership in distribution: GoMP has taken several initiatives to promote public-private partnership (PPP) in power distribution.
The initial efforts involved limited engagement of the private sector through outsourcing and/or management contracts for meter reading and bill collection. Recently the government decided to initiate PPP by granting concessions to the private sector to manage a fairly large area (distribution circle) with at least 500,000 consumers.
Private sector investments to power generation: To address the persistent generation capacity shortage of around 1,500 MW (about 20% of the peak demand) and Madhya Pradesh's relative lack of success in attracting private sector investments to power generation, MPG recently launched a policy on IPPs consisting of both the negotiated MOU and competitive routes. In the MOU route,
proposals are requested from credible and financially strong private sector parties to invest in power plants, with the condition that that the selected private developers would have to supply 10% of power output to state at variable cost of generation and 30% of the plant output at a price stipulated by MPSERC.)
3 SUGGESTIONS FOR IMPROVING THE ELECTRICITY SERVICES IN RURAL AREAS:
Subsidies to be given only to the extent of the state government's capacity to pay through budget provisions.
Move away from providing free power.
Electrification of all villages and households, and rural electrification to be treated as a basic minimum service
States to be given flexibility for using funds under Rural Development Programs with the consent of village/ block panchayats for undertaking electrification.
Electrification of remote villages to be included under a special mode of financing including a grant.
Stand alone Generation and Distribution delicensed. (vii) Gradual phasing out of cross subsidies.
Focus on revenue recovery in cases of unauthorized use of electricity.
REFERENCES
1. Power Minister Conference February 2000.
2. Electric Power International fall, 1999.
3. Guidelines for Energy Audit in Power Systems, CEA, and New Delhi May 1992.
4. Power and challenges - Excel books- R.V.
Shahi 2000.
5. ADB (Asian Development Bank) Evaluation study Report on Power Assesment performance in Madhya pradesh-2011.)
