| Introduction: Write a brief note on RDSS. Body: Write about salient features and benefits of RDSS. What are existing issues and challenges in RDSS. Provide some measures for addressing the challenges of distribution companies effectively. Conclusion: Briefly mention the need and measures to reform electricity ecosystem as a whole. |
The Revamped Distribution Sector Reform Scheme (RDSS) is a grant-based programme targeted towards electricity distribution. It aims to improve the operational efficiencies and financial sustainability of Discoms (Power Distribution companies).
Salient features and benefits of RDSS
- It will provide conditional financial assistance to strengthen the supply infrastructure of Discoms. The financial assistance is based on meeting pre-qualifying criteria and upon achievement of basic minimum benchmarks.
- It will merge all existing programmes creating an Umbrella programme. Which will increase efficiency.
- It is based on the action plan worked out for each state rather than a ‘one-size-fits-all’ approach. Which will create customized solutions for states.
- The scheme aims to create a universal smart metering ecosystem, it aims to install 10 crore prepaid smart meter by 2023. which will reduce theft and increase data availability on electricity use.
- It aims to modernize urban distribution system, reduce AT&C losses to 12-15% by 2024-25, developing institutional capabilities for Modern DISCOMs and reduce the cost-revenue gap of Discoms to zero by 2024-2025.
The Revamped Distribution Sector Reform Scheme (RDSS) along with the benefits also has built-in inefficiencies and challenges that need to be addressed
- Complex processes and conditions for fund disbursal which would make fund disbursal difficult, even previous schemes faced the issue of low disbursal of allocated funds.
- Lack of public review and regulatory oversight in states is still not addressed in RDSS.
- RDSS emphasizes investments over system strengthening for loss reductions. However, high losses are typically connected to sustained poor quality service.
- It aims to create universal pre-paid metering but post-paid options may be suitable in many contexts.
The steps that may be taken to address the inefficiencies and challenges
- While the RDSS along with other schemes aims to increase the electricity consumption in the country, the transmission infrastructure is not ready to handle the higher load. The RDSS’s system’s strengthening plans can focus on this challenge.
- About 25 per cent of electricity sales are highly subsidised, agricultural consumers. The KUSUM scheme can be utilised to fill the gap between supply and demand and also save losses of Discoms.
- Unmetered consumers and non-functional meters at the consumer and feeder level make accurate energy accounting and loss monitoring difficult. All feeders must be equipped with meters capable of communicating readings without manual intervention. RDSS’s emphasis on smart metering can be leveraged.
There is a need to address the inherent inefficiencies of RDSS along with reform in the electricity ecosystem including Generating companies, transmission companies and the governance in the power sector to improve the condition of electricity distribution companies and make the power ecosystem sustainable.
