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    Tamil Nadu joins Uday for Rs 11,000 crore benefits

    Synopsis

    By signing the MoU under Uday, the state government agreed to take over 75% debt of Rs 30,420 crore of its distribution utility Tangedco, an official statement said.

    ET Bureau
    NEW DELHI: Tamil Nadu on Monday joined the Centre's Ujwal Discom Assurance Yojna (Uday) to reap benefits worth Rs 11,000 crore by way of savings in interest cost by its power distribution companies, power distribution and transmission losses and other measures such as energy efficiency and coal availability.

    By signing the MoU under Uday, the state government agreed to take over 75% debt of Rs 30,420 crore of its distribution utility Tangedco, an official statement said. The scheme provides for the balance debt to be re-priced or issues as state guaranteed discom bonds at coupon rates around 3-4% less than the average existing interest rate.

    The state would have savings of about Rs 950 crore annual interest cost. The reduction id aggregate technical and commercial losses to 13.5% and transmission losses to 3.7% is likely to bring addition revenue of Rs 1,601 crore to Tangedco, the statement said.

    The Centre would give incentive to the state and its dicsom for improving power infrastructure in the state and lowering cost of power. The state will gain around Rs 4320 crore from coal swapping, rationalisation, coal washing and correction in grade slippages, the statement said.

    After several months of reluctance to join Uday, Tamil Nadu has become the 21st state to become part of the scheme. The Uday scheme now covers 90% of the aggregate debt of discoms of around Rs 4 lakh crore.


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