Question

UPSC Prelims 2016 Question:

Which one of the following is the purpose of ‘UDAY’, a scheme of the Government?

1. Providing technical and financial assistance to startup entrepreneurs in the field of renewable sources of energy
2. Providing electricity to every household in the countries by 2018
3. Replacing the coal-based power plants with natural gas, nuclear, solar, wind and tidal power plants over a period of time
4. Providing for financial turnaround and revival of power distribution companies

Answer (Detailed Solution Below)

Option 4: Providing for financial turnaround and revival of power distribution companies

Detailed Solution

Explanation:

Ujjwal DISCOM Assurance Yojana (UDAY) is the financial turnaround and revival package for electricity distribution companies of India (DISCOMs). The scheme UDAY envisages reform measures in all sectors- generation, transmission, distribution, coal, and energy efficiency.

It allows state governments, which own the DISCOMs, to take over 75 percent of their debt as of September 30, 2015, and pay back lenders by selling bonds. DISCOMs are expected to issue bonds for the remaining 25 percent of their debt.
This scheme also includes Operational efficiency improvements viz. compulsory smart metering, up-gradation of transformers, meters etc., energy efficiency measures like efficient LED bulbs, agricultural pumps, fans & air-conditioners etc. to reduce the average Aggregate Technical & Commercial (AT&C) Losses.

Therefore, option (4) is the correct answer.

Relevance: In 2015, the Ministry of Power launched the UDAY Scheme to bring reform in the power sector.

Subject: Polity | Government Schemes and Policies(pol)

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