CM 6-6 Change Requirement to Enhance Commercial and Financial Performance

8/6/2019 CM 6-6 Change Requirement to Enhance Commercial and Financial Performance

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Power Finance Corporation Ltd.(A Govt. of India Undertaking)

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Change Management in Power DistributionDistribution Reform, Upgrades and Management (DRUM) Training Program

Change Requirement to Enhance Commercialand Financial Performance

Compiled and edited by Pradeep Kumar Srivastava, CORE International, Inc.(based on the paper on Best Practices in Commercial Loss Reduction by Kodanda R.

Parupally, CORE International, Inc. and Out Sourcing Power Services by Energy

Economy & Environmental Consultants)

Introduction

There is a need to give a go by to existing attitude of as is condition and cant beimproved. There are ways and means to improve the environment and customerattitude through various means. DISCOMs have to make an effort to improvecommercial and financial performance.

The Approach

The DISCOMs have to resort to multi-pronged approach to build the confidence of thecustomers. There have been a host of reasons for illegal connections, non-payment ofbills. If one looks at the genesis, it would be realized that the customers resorted tothese due to two main reasons (besides some minor ones):

Delay in getting connections

Erratic and poor quality power supply

The reduction in commercial losses in power distribution utilities involves the followingsteps:

1. Direct tapping by the non customers.2. Pilferage by the existing customers.3. Defective metering, billing and collection functions, and4. The role of franchisees, user groups and gram panchayats in billing and

collection.

Direct tapping by non customers

In certain areas, direct tapping of power by non customers is widely prevalent. This ismainly in domestic and agricultural categories. Geographical remoteness, mass basisfor theft, poor law enforcement capability and inaction on the part of utility are helping

this phenomenon.

Some amount of public relations work by the utility is needed to tackle this menace. It isto be widely publicized that theft will increase the tariff for the genuine consumers, resultin poor voltages, burnt motors, failed transformers and dried crops. The scarceresources of the state meant for social welfare are diverted to feed these power thieves.

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Some change in the value systems of the society is also needed. The opinion makersand social leaders are to be involved to effectively tackle this massive social evil.

Direct theft is an insult and thus a challenge to the utility engineer. It speaks volumes

about the inefficient functioning of the company. Tackling it brooks no delay. Otherworks can be stopped and total attention diverted for this purpose.

The details of legislation, procedure to inspect, detect and prosecute the criminals arediscussed separately.

Pilferage of power by the existing customers

Theft by the existing consumers is the predominant cause of loss of revenue to theelectrical utilities. Almost all categories of the consumers are involved in this. Howeveremphasis can be given on inspecting high value services for more effective and

immediate gains.

The modus operandi

A. Totally bypassing the meter.

The meter is not tampered. It is like direct tapping. From the supply lines, the tapping ismade and part or full load is fed from that. This can be proved only when it is observedat the time of inspection. The consumer can erase all traces of theft if the inspection isknown in advance.

B. Tampering the meter.

1. Bypassing at the terminal block.2. Damaging the meter internal mechanism.

There are umpteen methods for tampering the meter. New methods are beingconstantly evolved. The thief is always ahead of the police. The latter tries andsometimes succeeds in catching the former.

The problem of theft, its magnitude, procedural aspects in detecting it and legal position

are discussed now in detail. Here, it is to be noted that these are common for bothcustomer and non customer theft.

Tackling Power Theft

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Genesis

Theft of energy is almost the single cause of all ailments afflicting power utilities. Thetransformer failures, breakdowns, poor collection of revenue, financial losses, the widespread customer dissatisfaction, the recurring crisis in summer crop period, the poor

creditworthiness resulting in inability to raise the funds needed for the required growth,increased technical losses and the corroded integrity of employees... are all themanifestations of the theft. These can include low frequency, cascade trippings in gridand unscheduled shutdowns. The whole bad image of the utilities is due to theft. In thedistricts where theft is non existent, the utility is having good reputation and vice versa.

Magnitude

In the nation around Rs.40, 000 crores are lost by the utilities annually. In any othersector - be it private, public or joint - or be it in the state or the nation no othercompany is losing money in this magnitude. In the world over power utilities are making

profits. Those shares are considered as retired peoples and widows' shares. Theymake money whether it is famine or flood, though not excess profits. With just half ofthis amount employment guarantee scheme is being planned. Within two and half yearsof this money all the 444 pending irrigation projects can be completed, irrigating millionsof acres.

Beneficiaries

The beneficiaries of theft are anti social elements, immoral political abettors andunscrupulous industrialists. The bad money is driving out the good money from themarket. This is a social menace crippling all other developmental and social welfare

activities.

ForerunnerA.P., as usual, is the forerunner in recognizing this menace and established a separatewing for pilferage detection as early as in early sixties. Even now in some states there isno such separate cadre for detecting pilferage. The local officer, either operation orconstruction or MRT, is very much preoccupied with his busy day-to-day activities andcannot spare time for detection of theft. The social and political influences aremore easily brought on the local officer who has, perforce, to deal with them inother fora regularly. A specialized knowledge on the functioning of various metersand the latest M.O. of power theft can be acquired by a dedicated band only.

Personnel: While filling up DPE (Detection of Pilferage of Electricity) wing extracare is to be taken so as to have only officers having the required technicalknowledge, tact, tenacity and integrity: at times, they would be detecting, dealing anddeciding the cases involving crores of rupees on the spot.

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Sensitive areas: The targets are to be finalized much in advance. The precise time ofraid shall be kept confidential. Go in required numbers. Small is beautiful. Mobility isrequired. Get satisfied if you could detect one or two cases. Close the show in one ortwo minutes. Inform all the members of the team, to come back to the vehicle in oneand a half minutes and there would be no waiting for them. To the extent possible, bring

the criminal along with you.

Sprinkle color: Take color photos of the scene and details of offence. Avoid privatephotographer; he may decline to stand as a witness in the end. Have five copies ofeach photo. Furnish negatives to police. Mark the particulars and if possiblesignatures on the reverse of photo.

Writingnotes: Fill up every item of the inspection notes. Note correct postal address.Draw a sketch of the scene of offence on a separate sheet marking the orientation. Tryhard to get signature of the consumer/representative. Procure independent witnesseslimiting to two. Even departmental witnesses should be limited to one or two. The utility

cannot afford more witnesses. You lose the case by not being able to bring all thewitnesses at a time for the hearing and by not being coherent.

The scene and method of crime should be noted clearly. Don't commit the details ofwhich you are not certain.

Police. They are there to protect law and order and to look after all the teams. They arenot there in a single scene of offence from the beginning to the end. Their names arenot to be noted in the inspection notes.

Seizure. The Act is emphatic on incriminating material. So bring the materials, wire and

equipment to prove the crime. Note like this; The service wire and the motor used forcommitting the pilferage are removed from the scene of offence to hand over the samein the police station for producing in the court as material evidence. Keep theincriminating materials in a cover/carton, seal and have it attested by all.

F. I. R. Give the complaint as soon as possible. Delay is dangerous. In thecomplaint you can add the names of the persons who are actually committing/abettingthe crime. Narrate the whole event as it passed. Note the taking of photos, removal ofincriminating material and hand over the same along with complaint. On a separatesheet, write down the full name, age, profession and address of all the people involvedand give one copy to S.H.O. On a small slip, note down the details of crime, signatures

and paste it to the removed material. Give extra slips to police.

Court matters: calling out in a court is the initial stage in the day when the cases to beactually taken up on that day arc decided basing on the presence of the personsconnected with the case. Crime No. is the number given to a complaint registered in thepolice station. Court Case No. (C. C. No.)/Original Suit No.(O.S.No.) is the serial

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number of the case registered in the court initially. I.A.No. (Interlocutory ApplicationNo.) is the number given to an interim petition filed by either of the litigants in which oneseeks an interim relief while the original case is yet pending. W.P.No. (Writ Petition No.)is the case number in high court. W.P.M.P. (Writ petition miscellaneous petition) isinterlocutory application in W.P. IPC 186 is for mere obstructing the public servant and

is cognizable. IPC 353 is for obstructing the public servant with force. It is bailable,cognizable and can go up to 2 years or fine or both. IPC 332 is for major injury to publicservant. In cognizable offence, police can arrest without warrant. Cr. P. C. 43authorizes private persons to arrest the criminals in certain cases.

Rehearsal: One day before the trial, collect the witnesses and recollect the scene ofoffence so that the actual incident can be presented to the court accurately and withcoherence. Ensure the presence of other witnesses. Go through the file. Meet thelawyers in advance and clear their doubts. Appeals are to be made in time.

Suggestions: Let there be frequent change of incumbents interacting with the

consumers. A message should go to every one in the society that theft would be curbedat any cost. Every officer should be made conscious of the present policy of making himaccountable for the energy taken by him. A comparison with contiguous areas willhighlight the weak spots. Any replacement of single phase meter shall be done onlyafter S.O. inspects, Asst. Divisional Engineer in case of 3 phase meters. All removedmeters should be handed over to M.R.T. It shall check every meter for possibletampering. Inaction-on the part of any field officer-in detecting cases shall be reviewedand taken seriously. The theft is very predominant in many areas. Single Section Officeror handful of DPE officers can never complete the job. Authorizing revenue andpolice officials, as is done in M.P., to detect theft is desirable. Sub engineers and UDCsalso can be authorized to book category I cases at least when there is no meter at all.

Electronic meters will go a long way in controlling theft. Clear guidelines on theprocedure to be adopted, while releasing a new service, are to be issued.

MIS: The performance of DPE wing is to be reviewed periodically as is done for otherwings. Their functioning in all the activities is to be taken into account. MIS reflecting theperformance of an officer in controlling theft is to be insisted.

IT Applications: Of late, the rate of booking cases increased substantially. Thedrudgery of paper work is appalling. No meaningful review and follow-up is becomingpossible manually. Marking of copies to various wings, communicating to them andconfirming subsequent actions manually is really meaningless in this age. So I.T. should

be brought in and made full use of. Already M.A.T.S. is being implemented inHyderabad company. This is to be studied and revised suitably and implementedthroughout. CAT is a useful tool for detection of theft before inspection.

Nemesis: Control of theft is not a single time operation. No amount of hi-tech gadgetry,ABC, boxes to meters, theft-revealing meters - will serve any purpose unless they are

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accompanied by continuous vigilance. Stop other work, if necessary, and rush forcatching the thieves now!

Theft of energy and Electricity Act 2003

I. Electricity Act 2003 brought radical changes in all the facets of the electricitysector. Let us consider its impact on power theft and assessment.

II. Sec.55 contemplates compulsory metering of all the services within 2 years.Concerned E. R. C. is to initiate action on the defaulting company and person. Itcan extend this period if necessary.

III. Sec.126. Earlier, the litigation could be prolonged endlessly. Further there wereinnumerable stages for appeal by the accused. Now they are reduced to just two.a. Inspecting officer is herself the provisional assessing officer and

acts as the final assessing officer too.b. This section is non criminal in nature.c. Assessment is at one and half times the normal rate.

d. The assessment is to be made for 3 months for domestic andagricultural services and 6 months for other services.

e. The consumer could always say that he did not receive any noticefrom the utility. Now the Act says that it could be served on any personavailable.

IV. Sec.127. There is only one appeal. It is to be made within 30 days after makingone third payment. Earlier, there was protracted litigation without any payment orwith nominal payment. After such long periods, interest too was not levied. Thissection specifies 16% half yearly compounded interest after 30 days of order ofassessment and not from the date of serving of the notice. Further, the decision is

final.V. Sec.135. Criminal prosecution is to be launched on the person whoDISHONELSTLY taps, tampers, damages etc.a. 3 years imprisonment or fine or both can be levied. For the first

offence, the fine is at 3 times the loss sustained by the utility. For the secondoffence, it is at 6 times and if the connected load is more than 10 kw,imprisonment is from 6 months to 5 years.

b. The burden of proof rests on the consumer.c. The inspecting officer can break open, seize and remove records.d. But the presence of one adult male member of the family is

necessary from 6 p. m. to 6 a. m.

VI. Sec.138. Restoration during disconnection period, even if it is through the meter, isa criminal act entailing 3 years imprisonment or fine of Rs. 10,000 or both.

VII. Sec.145. No civil court has jurisdiction.VIII. Sec.150. The utility officials can prosecute the ruffians and misleading leaders for

abetment of these offences even if it is against the provisions of Cr. P.C. The black

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sheep in the utility employees can be prosecuted as abettors whenever they evenjust acquiesce.

IX. Sec.151. The complaint can be lodged, inter alia, only by the employees of theutility.

X. Sec.152. Compounding of the case is permitted at the specified rates.

S. No. Nature of service Rate per kw /hp /kva

1. Industrial Rs. 20, 000

2. Commercial Rs. 10, 000

3. Agricultural Rs. 2, 000

4. Others Rs. 4, 000

The appropriate government may change these rates.The acceptance of the compounding fees by an officer empowered shall amount toclean acquittal.This can be availed only once for any person or consumer.

XI. Sec.153. A special court shall be constituted for these cases with a judge of thecadre of Additional District and Sessions Judge.

XII. Sec.154. Only Special Court. Summary trial with punishment up to 5 years. Canpardon. Civil liability not less than 2 times the assessment for 12 months.

XIII. Sec.156. Appeal to High Court.XIV. Sec.157. Review by special court.XV. Sec.168. Protection for bonafide actions of assessing officer, public servant etc.XVI. Sec.169. Assessing officers along with others are public servants.XVII.Sec.170. Considered as land revenue.

XVIII. Sec.171. Notice can be served on the person available, or pasted at aprominent place.

Defective metering, billing and collection functions.

These losses are not due to any deliberate actions of the customers.

They are due to internal shortcomings and hence are that much easier to tackle.

They thrive due to the fact that the boards did not function on commercial lines though

they were supposed to do so.

Metering:

There are many services unmetered. A large scale drive is necessary to bring allunauthorized consumers on to the rolls. Such drive in Andhra Pradesh during a single

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month of June 2000 resulted in metering of 20 lakh new consumers and regularizationof 2.57 lakh agricultural services.

The Act contemplates metering of all the services within 2 years and visualizes actionon the company and the individual officers responsible for lapses. So unequivocal

instructions are to be issued to not to release any new service without meter. All theexisting unmetered services shall be stopped to be so immediately. The utility shouldconcentrate on purchasing of adequate quantity of meters both for fresh services andfor replacement of the defective meters in the existing services. Purchasing of othermaterials shall be given low priority, if the financial position demands it. Other materialscan be purchased by the consumers.

Unmistakable instructions are to be given on the standards to be adopted at the time ofreleasing of new services. The service wire is to be brought in a pipe which shall bevisible throughout and end in the meter box with a gland. The meter, preferablyelectronic, shall be fixed in a box visible and accessible from outside. The meter shall

be fixed in a box at a height of 5to 6 from the ground. The particulars of seal bits usedare to be noted and attested by the consumer. Proper earthing is needed at theinstallation. This earth, body earth and neutral are to be clubbed up on the meter board.If all these precautions are taken, possibility for theft and defective metering arereduced drastically.

An exhaustive note on releasing of high value services is given separately.

The meters tend to get sluggish over a period of time. Old meters are to be replaced ina phased manner by high accuracy meters, specially for high value services and atplaces where the load varies substantially.

C.T. meters are to be adopted in stead of whole current meters for L.T. high valueservices.

A comprehensive energy audit will pinpoint the areas of high commercial losses.Important services, feeders and towns are to be taken up early for this exercise.Actually, the biggest ever theft case was detected while on one such exercise.

Following are the general defects observed in metering.

Many stuck up meters are allowed for years.

For a good number of services, no readings are furnished by the meter reader, attimes, continuously.

Constant nil consumption cases are reported without any comment.

There are progressive readings in disconnected services.

There is considerable voltage drop in metering cables.

The meter capacity and the load have no relation.

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Wrong multiplication factors are adopted. After the M. F. is changed, it is notintimated to the billing agency.

BILLING

Correct billing and timely serving will go a long away in improving the collections. Thenormal complaints in the billing process are: non receipt/ late receipt of bills, receiving ofwrong bills, wrong reading/ status, table readings and wrong calculations. All these canbe avoided in a single go by going for computerized spot billing as is already done insome states. This can be introduced in stages starting from cities. A thoroughunderstanding by the readers on the various statuses of the meter is a sine qua non forthe success of the system.

Common billing software adoption is to be achieved so as to have a meaningful control,review, storage and retrieval of the consumer database. Even the application of CATwould be more effective this way.

Monthly billing is to be achieved for the convenience of the consumer and also forpsychological reasons. Stringent checks are to be adopted in the billing process so asto plug the leaks.

The first bill is not issued or is issued late in many cases. The customer service numberis to be noted on the meter at the time of issue in the section office.

The utilities adopt the last 3 months average in case of abnormal meter status. A meterbecomes initially sluggish and then slowly drifts to stuck up position. So the last threemonths average would not give a correct picture of the consumption. A study in A. P.

revealed that the utilities are annually losing scores of crores on this count alone.

Very high consumption when compared to the similar connected loads indicatesunauthorized additional loads. The services, where the standard deviation inconsumption is less than 2%, are to be targeted. Similar action when there is abnormalvariation. Constantly getting less than minimum in good areas should attract ourintention.

The power distribution companies have a unique advantage of contacting millions ofcitizens at least once in a month. This is to be utilized fully to explain the latest initiativesand seek their support in their own interest and in the interest of the company. The

Tirupathy based company spared some space in the reverse of the bill to an advertiserand thus the bill making cost is saved.

Collection

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Unbundling and corporatisaion will give a real boost for the collection effort. Everycitizen would feel it to be her normal duty to pay for the commodity she purchased. Thepoor now have a tendency to feel that they have a natural right to enjoy the governmentbonanza. But even the poorest man will not dream of having a soap freely from theseller. After reforms, there was phenomenal increase both in demand and in collection

percentage in A. P.

Increased customer convenience shall be the guiding factor for smooth collections.Drop box facilities and roping in more collection agencies make the lengthy queuesvanish. E seva centers are a relief to the customer as around 25 types of bills areaccepted in a cool atmosphere at convenient hours in the holidays too. On line facilitieslike icici bill junction are extended.

Special collection drives, coupled with intensive inspections, in the areas where thepayment history was bad, brought terrific results. Effective disconnection of defaultersshall be a norm rather than a chance occurrence. CAT is to be applied and high arrears

services are to be targeted. Class F services, where the consumer is availing supplywithout any payment from last one year are to be initially tackled for more impact.Reversal entries in the case of non paying consumers demand immediate attention.

The worst villages are to be adopted by DPE and vigilance wings and make them asmodel villages. This will be a spark for others to act.

Every house shall have the service connection no. painted at the pole, gate and meter.In fuse off call offices, before attending a fuse off call, they verify the defaulters list.Only when these two conditions are fulfilled, the complaint would be attended.

The electricity revenue officials are to work and they are to be pin pointed for poorcollections. The revenue recovery act is to be made use of. There shall be compulsoryand immediate prosecution in the case of bounced cheques. It is interesting to note thatno witness, except the bounced cheque, is necessary for imprisoning the offenderpromptly, in these cases.

The problem of fraud ever lingers on in the collection process. In one case, a singleemployee in electricity revenue office could knock off more than one crore rupees inabout a year. Computerized monitoring system will help here.

Increased booking of cases on thieves and defaulters will bring real change in collection

scenario. Anti power theft police stations (APTS) to deal exclusively with these casesare desirable to have any meaningful effect.

Out sourcing Power Services and the concept of Franchisees

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The ESCOs have certain limitations in operating continuously at a particular location,which will limit their scope to a large extent since they have many other roles to play inthe overall energy sector scenario. After the initial introduction of the particular modelsuiting the particular area with its own characteristic features ESCOs have to find somealternative entity to take over the operation. The alternatives can be a cooperative

society formed at the village/group of villages level, franchisees with requiredbackground that are willing to take up the responsibility.

In this context it is appropriate to quote the relevant section of the Electricity Act 2003.

Section 5 of the Electricity Act 2003 states -The Central Government shallformulate a national policy, in consultation with the State Governments & theState Commissions, for rural electrification and bulk purchase of power andmanagement of local distribution in rural areas through Panchayat Institutions,users associations, cooperative societies, non-Governmental organizations orfranchisees.

Thus it is imperative that a suitable mechanism be put in place to take care of the ruralelectricity distribution management at the earliest.

In Orissa and Karnataka States attempts have been made to bring in some sort ofcommunity participation in rural electricity distribution. The following illustrations will leadto the final evolution of Franchisees for rural power distribution management.

Grama Vidyut Prathinidhis:

In Karnataka the concept of Grama Vidyut Prathinidhis were introduced as a pioneering effort HESCOM and the same was extended to all the ESCOMs in Karnataka. The followiparagraphs give the salient features of the scheme.

Rural power sector is not commercially viable as at present.

HESCOM is a predominantly rural utility.

Grama Vidyut Pratinidhi concept introduced in June 2003 to improve revenue.

One-Gram Vidyut Pratinidhi per Gram Panchayat.

Grama Vidyut Prathinidhis were selected from the same Grama Panchayat area

and the Gram Panchayat was also involved in the process of selection. Minimum qualification of ITI was prescribed.

GVPs main activities include Meter reading; Bill distribution and Revenuecollection and the required training in these activities were imparted to them.

GVP acts as one point customer care center for the rural consumers and not onlysolves many local day to day electricity problems but also initiates actions

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through local sub division of ESCOM system improvement works to solve majorproblems like providing additional Distribution transformers to reduce overload,improve voltage profile etc.

GVP also facilitates the reduction of unauthorized users of electricity with thehelp of local leaders.

An incentive based compensation package was devised for the GVPs. GVP with proper service satisfies customer, and thereby improves collection

With the introduction of GVPs the following important phases were covered.

Phase-I: 127 GVPs in 5 Taluks- 1/06/2003

Phase-II: 463 GVPs in 11Talukas-1/11/2003

Phase-III: 757 GVPs In 23Talukas-1/04/2004

Total 39 rural based Taluks are covered by GVP Operation

Enhancement in revenue collection in rural sector achieved.

The following graphs illustrate the success level of the GVP project in HESCOM

Chart 1:Performance

GVP Performance-HESCOM TOTAL

0

10

20

30

40

50

60

70

April May June July

Millions

Month

CollInRs.

Base

Actual

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Chart 2: Cumulative Additional Revenue Mobilized in 39 Taluks under Project GVP

3.727399

8.974223

17.655815

33.974931

0

5

10

15

20

25

30

35

40

April.04 May.04 June.04 July.04

Millions

Month

MillionRs.

Series1

Franchisees for Commercial operation:

Close monitoring of GVPs for further improvement in revenue mobilization is veryessential. GVP is not a stakeholder in loss reduction.

Large network of GVPs becomes unwieldy to monitor without additional supervisorysupport from ESCOMs. Since ESCOMs cannot provide additional supervisory support itbecomes imperative to have Franchisees at the intermediate stage.

The Concept of Input Based Feeder Franchisee for 11kV rural feeders was introducedpurely for commercial operation at the first instance.

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Per unit Recovery

No. of consumers, No. of LT4 consumers

No. of metered LT4s and No. of un-metered LT4

In the first phase 142 feeder from 12 O & M subdivisions in HESCOM were entrusted to

Feeder Franchisees purely for commercial activities. In this change over many GramaVidyut Prathinidhis were capable and took over as franchisees.

Input and Investment based Feeder franchisee.

Final step in the out sourcing process for rural electricity distribution management will bobviously The input and Investment Based Feeder Franchisee

Here again thru franchisee can be an individual/group of individuals forming a society, arural cooperative society or an entrepreneur, self help group, user associations, NGOs,Panchayats, local bodies etc. However the entity should be acceptable to the local

beneficiaries and should have experience in such operations or should associate withpersons/entity having the requisite experience. The GVPs and the commercialfranchisees can also take up such schemes.

5.3.1 Objective:

The model should be a participatory model of distribution in rural areas, which aresensitive to the local aspirations and requirements. The objective of such arrangementcan be listed as follows:

(a) To promote public participation for bringing effectiveness in the present distributionarrangement for reducing theft and conducting maintenance and distributionsystem on community basis through the Distribution Franchisee.

(b) To encourage community management in the maintenance of distribution lines forits' protection and promotion.

(c) To attract private investment in distribution through the Distribution Franchisee(d) To promote technical and managerial capability of the beneficiaries / community in

the field of electricity distribution through institutional capacity building and trainingefforts.

5.3.2 Benefits to stakeholders from the scheme

For rural households, there will be direct and indirect benefits of increased accessto adequate and reliable supplies of electricity, which would improve the quality of

their lives and expand income generation opportunities. Direct benefits includeimproved convenience, safety and quality of lighting, enhanced ability to operatesmall appliances and improvements in indoor air quality resulting fromdisplacement of kerosene smoke. The indirect benefits would arise from theimproved services provided by rural public institutions - health, education andwater - deriving from their increased access to electricity;

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For rural enterprises, the benefits of increased productivity and income arising fromelectricity access;

For utility customers, greater access and reliability of electricity service due toincrease in generating capacity and mitigation of tariff increases due to increasedenergy efficiency investments;

For medium to large scale local investors who can invest in electrification businessopportunities;

Greater leveraging of Government financial resources for capacity addition andrural electrification.

5.3.3 Role of Stakeholders

a) State Government

Publicize and make aware the stakeholders about potential sites / locationsfor implementing the schemes.

Provide an enabling framework for streamlined operation of the developer inthe area.

Maintain system of constant checks and controls through localadministration with involvement of the beneficiaries for more participativeinteraction.

Monitor and evaluate implementation of the scheme.

b) State Utility / DISCOM

Assist the Supply provider during identification and execution of thescheme.

Support the supply provider during the initial operation period.

To educate the Supply provider and consumers in its jurisdiction on theefficient use of equipments such as lighting, pumpsets etc. for conservingenergy.

Educate community on safe use of energy.

Designate Project Manager for the scheme who would be responsible foroverall financial and physical progress, verification of bills of the Proposer,furnishing of claims to PFC for seeking funds etc.

c) Local administration

Act as trustee of beneficiaries interest w.r.t. the investments made, securityof assets, continuity of the system & stakeholders.

Provide for quality of service measures & controls ensuring streamlinedoperation of the system without any undue interference.

d) Supply provider/ Franchisee

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The scope of work given herein is indicative for an input based Franchisee model, thescope would vary as per terms and condition on case-to-case basis.)

Technicalo Breakdown maintenance and repairs of Distribution lines.

o Maintenance of Distribution Transformers and other equipments.

o Maintaining the reasonable stock of line and sub-station materials requiredfor repairs.

o Replacement of failed transformers and equipments.

o Install meters to all unmetered installations

o Attend to consumer's complaints & grievances.

o Prevent pilferage & thefts of energy.

o Receive application for new connections.

o Prepare feasibility report & estimate for new connections.

o Sanction estimates for new connections as per norms & approved

polices / procedures.o

Prepare estimates and drawings for extension and improvement works, tobring down energy losses to acceptable levels, check theft and energyaccounting.

o Servicing of new installation with meters

o Execution of improvement works.

o Identify inefficient pumpsets and arrange for replacement with efficient

pumpsets by bringing in necessary investments.o Submission of prescribed reports to the DISCOM / Government.

o Identifying unauthorized installations & take suitable action.

o To follow the provisions relating to safety and electricity supply.

Revenue:o Meter reading

o Billing

o Collection

o Maintenance of records

o Submission of monthly accounts & statistics to respective DISCOM /

Government.o Reply to audit queries

o Use necessary hardware/software for issuing computerized billing and

generating reports, wherever feasible.o

Collecting government charges /levies & paying the same to theGovernment.

General Functions, Duties and Responsibilities of Distribution franchiseeThe rights and obligations of the Franchisee will include:

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o Supply of electricity to all consumers within the Franchise Area

Increase technical efficiency of distribution system, reducing technicallosses, evolve innovative solutions to improve system performance andrevenue realization.

o All commercial activities relating to issue of new service connections,

metering, meter reading, billing, collection, realizing bad debts,disconnection, reconnections, customer complaint handling etc. within theFranchise Area

o All repairs and maintenance activities related to all equipment and

infrastructure within the Franchise Areao All investment decisions (capital and operating), subject to approval by the

DISCOM, that might be required to enhance the operations or meet thespecified standards of performance of the distribution business within theFranchise Area

o All manpower to run the operations and commercial activities will be

provided, managed and paid for by the Franchisee without any recourse to

employment by the DISCOMso Responsible for the operation and maintenance of the substation however,

any repairs. Replacements related to the power transformer in thesubstation are excluded from the responsibility of the Franchisee.

o The Franchisee shall reasonably maintain and operate the billing system

database and ensure the overall integrity of the system.o The Franchisee shall furnish DISCOM with data, information and analysis

and any other information as may reasonably be required by DISCOMfrom time to time

o Ensure Franchisee Distribution System has a [99%] availability, and

adequate quality of supply is maintained [measurement parameters andmethodology to be developed] thus put in place a Performance MonitoringSystem.

o Set up a system to respond to Consumer complaints with respect to

consumer servicing [measurement parameters and methodology to bedeveloped]

o As an agent of the DISCOM, comply with all the regulatory, legal and

reporting requirements that are applicable to the DISCOM.

Documents

CM 6-6 Change Requirement to Enhance Commercial and Financial Performance