Date | 31st Aug 2016:

On the sidelines of Motilal Oswal Conference, CNBC-TV18's Anisha Jain caught up with Piyush Goyal, Minister of State with Independent Charge for Power, Coal, New and Renewable Energy and Mines and asked about the progress of the UDAY scheme and the status of aggregate technical and commercial (AT&C) losses.

Piyush Goyal said that the ministry has not funded any states with fresh funds and there has been a financial impact of UDAY as losses have come down for discoms.

At present, there is no thermal power plant in India which is stranded for want of coal, the government has given out massive amounts of coal through e-auctions and the new coal linkage policy is under dicussion and finalization, Goyal said.

Below is the verbatim transcript of Piyush Goyal’s interview to Anisha Jain on CNBC-TV18.

Q: Can you give us an update on the progress of the Ujwal DISCOM Assurance Yojana (UDAY) scheme and the status of the Aggregate Technical & Commercial (AT&C) losses and a tariff hike?

A: The first year is not yet over. The scheme was only notified end of November. Of course we have not funded any of the states with any additional funds. So, the immediate impact so far felt has been more on the bonds that they have issued and the states have taken over some debt. So, in terms of the financial impact, we are already seeing the losses come down.

The AT&C reports are still to come in; we have only had two quarters since then. AT&C losses will come in through the efforts of the state government which we are supporting through the Deen Dayal Upadhyaya Gram Jyoti Yojana, through the Integrated Power Development Scheme (IPDS), through implementation of technology, all of which will take a little longer. So, one should not start jumping the gun too fast.

Q: Moving on to the coal situation, there is a dichotomy where we have surplus coal available, we have good inventory but then there are lot of power plants which are stranded for want of coal. What is the update that you can give us on coal linkage and coal e-auction?

A:There is no plant in the country which is stranded for want of coal. To ensure that everybody gets coal, even while the linkage policy is being finalised, what we have done is, we have had massive amounts of coal being given out through e-auction processes. Earlier e-auctions used to be for immediate lifting; now we even do e-auction to be lifted over one year. So, we have ensured that anybody who requires coal can bid in these auctions and get a one year assurance that he can lift that coal over a period of one year.

If there is any plant that comes to your attention please flag it off with us. There is to my mind no new buyer because we want to dilute stocks, so, we are really looking for new buyers. However, the linkage policy is also under discussion and finalisation and we may come out with it quite soon.

Q: he new air pollution norms stipulate that the infrastructure of the power generating units have to change. With this the cost of tariff of power might just go up. What is the strategy there and also do you think we will have to push the timeline for the replacement of these assets?

A:The environment ministry has come out with certain norms. We are in dialogue with them to work out what is the most cost effective way and timeline which is in the nations interest and the people’s interest. However, we will not compromise with the environment. This government sincerely believes that keeping our environmental concerns is paramount for the long-term sustainable success of India. So, we are very focused to ensure that environment is not tampered with but we also don’t want to be unrealistic.

For example, they has recently flagged off to me that all the 180-200 gigawatt of thermal plants, if we were to try and convert to the new standards, we don’t have the technical capacity in India to achieve that. So, we are in dialogue with the environment ministry to work out the most cost effective and balanced way where affordability of power is maintained and environmental concerns are taken care of.

Q: On Ultra Mega Power Projects (UMPP), what is the delay, why are we not hearing anything on the ground about the UMPPs?

A: Because I don’t see any hurry also. There is no tearing hurry. There was a time when the nation was always talking of power shortages, when there was a tearing hurry, today I have sufficient capacity, I have sufficient power availability and sufficient visibility for the forthcoming years about power availability. So, I am trying to see how I can further refine the process and make it better and better.

(Source: http://www.moneycontrol.com/)