Saubhagya Scheme- The Electrification Challenge

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TOPIC: General Studies 2

• Government policies and interventions for development in various sectors and issues arising out of their design and implementation.
• Development processes and the development industry the role of NGOs, SHGs, various groups and associations, donors, charities, institutional and other stakeholders
• Welfare schemes for vulnerable sections of the population by the Centre and States and the performance of these schemes;

In news: PM launched Rs. 16320 crore scheme to supply electricity to all households by December 2018, providing free connection to poor and at low cost to others. The PM Sahaj Bijli Har Ghar Yojana named SAUBHAGYA aims to improve environment, public health and education and connectivity with help of last mile power connections across India.

Rationale: Despite the government’s aggressive village electrification programme, the Deen Dayal Upadhyay Gram Jyoti Yojana launched in July 2015, under which 78% of 18,000 villages have been electrified, it was realised that the problem of electricity ‘access’ wasn’t resolved. A village is marked electrified if 10% of the households are given electricity along with public places such as schools, panchayat office, health centres. However, a large number of household still remained without access to electricity.

Why now?

More than a decade ago, it was decided to take electricity to every village. At that time, there was desire of opting for renewable energy, but as their cost was high, the villages objected to their use and states were also not keen on subsidizing it. Today, the country has surplus power, the cost of renewable energy has come down. So it is right stage to make electricity reach every home.

Benefits: It will help reduce use of kerosene lamps in non-electrified households. This scheme would bring major changes to the lives of the poor. It may be difficult to take gas connection to every household. But the kitchen has to be cleaned up with cleaner cooking fuels (biomass), provide lighting and provide electricity for small industry and artisans working closer to home.

Challenge known but little done to overcome it

The biggest challenge and weakest link has been the distribution companies of electricity chain starting from generation, transmission, distribution and consumption. The Discoms have not been able to perform. They are largely state held monopoly and consumer has no choice but to go to one supplier. Now the time has come to start working towards separation of carrier and content so that non performers are pushed to side.

Any system can function in a sustainable manner if the money invested in system gets back. This can happen from distribution end. If the transmission and distribution losses which includes commercial losses, are not improved drastically, it will be an ever losing proposition.

For this, there should be either stricter laws or improving technology. The latter is better option as stricter laws can be misused. Telecom is the right example for this.

The importance of electricity

69% of people still live in villages and migrating to cities. Electricity has been perceived so far as city or town centric. This scheme has the capability to make people live in their villages with unhindered electricity.

Two factors responsible for power sector mess are

1. Gaming at the highest economy including businessmen, politicians, bureaucrats, and engineers. In greed of earning money, the poor are being grilled without any fault of theirs.
2. The electricity is supplied when not needed and when needed, it is not supplied.

India is an agrarian society. It cannot sustain itself unless villagers develop themselves and retain themselves in villages. Along with smart cities and towns, India needs smart villages. It can be done through decentralized generation of electricity. The glamour of announcing big projects and them failing is the proof. In decentralization, no big transmission lines are needed. So worry of setting up project, project funds, management failures and all kind of mismanagement can be eliminated. There can be 1MW, 2MW, 3MW projects in villages. They can be developed along with dairy, food processing and storage for local market. From this local market, the government has to ensure that products are picked up. All middle men are thus eliminated. This will make people see that this scheme is for them.

Non-conventional source of electricity

Solar energy is going to change the complete platform of electricity sector. Solar parks and green corridor have been derived as suitable alternative to conventional resources. Solar plants can be settled at 2.3-3 mts high. So land acquisition becomes non-problematic. The people on whose lands the solar plants are being made should be made partner. If this happens, every village or group of villages will support to have electricity infrastructure and thereby have good school and college. Skill development will happen, job creation will be possible because of cold storage, food processing, market mechanism etc.

Taking the connectivity to one place or arranging the local source is one part. The real challenge lies in making it sustainable, i.e. provide 24 hour round the year power supply. It has to be also ensured that money invested in system comes back.

There is a need to revolutionize collection of dues at the distribution end. There should be pre-paid metering just like the model of telecom sector. It has been able to penetrate the poor sections without any issues of collection. Every household can decide the amount of electricity it requires on an average and pay previously for it and get uninterrupted supply until the balance finishes. This will instill the sense of judiciously using the electricity as well as realizing that electricity shall not be free. Once electricity is there, there is demand generation and there is use to it and ready to take pre-paid connection, it will be game-changer.

Benefits of Saubhagya scheme

The present scheme aims to build upon Deen Dayal Upadhyaya Gram Jyoti Yojana launched in 2015 and Rajiv Gandhi Grameen Vidyutikaran Yojana launched by the UPA government in 2005, both of which also aimed to provide free electricity connections to the poor.

It aims to improve electricity access within villages that are already classified as “electrified”. With electricity, there will be larger penetration of telephone, digital payments, more ATMs, tourism in rural areas which encapsulate natural beauty.

Way ahead

Free electricity connection is not the end. Affordability of the electricity should be next step taken. Though India is claimed to be power-surplus nation, the power generation utilities remain vastly under-utilised. Though Ujwal DISCOM Assurance Yojana (UDAY) has been not quite successful in making an impact to restructure the debt of State distribution agencies, more and more efforts should be made under it. The discoms should be given the freedom to sell at a profitable price as well as be supplied with demand asked for after consulting various stakeholders.

Connecting the dots:

• Electricity is the ‘guiding light’ towards attaining the goal of ‘developed India’. Critically analyse with respect to new scheme launched recently.