India : West Bengal Distribution System Strengthening Program
The RDSS program is the overall government program for the proposed result-based lending (RBL) program. In 2022, the Government of India and Government of West Bengal approved the RDSS program for WBSEDCL with a financial outlay of
197.39 billion for an implementation between 2022 and 2026. The RDSS program is aligned with the Government of West Bengal's priority to improve quality and reliability of electricity supply and achieve financial sustainability of WBSEDCL while meeting a growing power demand. Upon successful completion of the RDSS program by 2026, WBSEDCL aims to (i) eliminate ACS-ARR gap (on subsidy receipt basis), (ii) reduce SAIFI to 130.0 interruptions per customer, and (iii) reduce AT&C loss to 12.11%, which will result in 4,700 gigawatt-hour of annual electricity savings, thereby avoiding 3.36 million tons of annual GHG emission.
Project Details
-
Project Officer
Sanda, Roka
South Asia Department
Request for information -
Country/Economy
India -
Sector
- Energy
- Project Name
- West Bengal Distribution System Strengthening Program
- Project Number
- 57148-001
- Country / Economy
- India
- Project Status
- Proposed
- Project Type / Modality of Assistance
- Loan
- Source of Funding / Amount
Loan: West Bengal Distribution System Strengthening Project Source Amount Ordinary capital resources US$ 241.30 million - Operational Priorities
- OP1: Addressing remaining poverty and reducing inequalities
- OP2: Accelerating progress in gender equality
- OP3: Tackling climate change, building climate and disaster resilience, and enhancing environmental sustainability
- OP6: Strengthening governance and institutional capacity
- Sector / Subsector
Energy / Electricity transmission and distribution
- Gender
- Effective gender mainstreaming
- Description
The RDSS program is the overall government program for the proposed result-based lending (RBL) program. In 2022, the Government of India and Government of West Bengal approved the RDSS program for WBSEDCL with a financial outlay of
197.39 billion for an implementation between 2022 and 2026. The RDSS program is aligned with the Government of West Bengal's priority to improve quality and reliability of electricity supply and achieve financial sustainability of WBSEDCL while meeting a growing power demand. Upon successful completion of the RDSS program by 2026, WBSEDCL aims to (i) eliminate ACS-ARR gap (on subsidy receipt basis), (ii) reduce SAIFI to 130.0 interruptions per customer, and (iii) reduce AT&C loss to 12.11%, which will result in 4,700 gigawatt-hour of annual electricity savings, thereby avoiding 3.36 million tons of annual GHG emission.
The proposed RBL program aims to comprehensively support reducing AT&C loss, eliminating ACS-ARR gap (on subsidy receipt basis), improving SAIFI to supply quality and reliable power supply, with particular attention on gender equality, social inclusiveness, and occupational health, while supporting institutional strengthening to sustain the results and to scale up integration of renewable energy and create an enabling environment for private sector involvement.
- Project Rationale and Linkage to Country/Regional Strategy
In tandem with 6.8% of rapid annual gross domestic product (GDP) growth between 2012 and 2022 in India, electricity demand in the country grew at 5.1% annually during the same period. The energy sector is the dominant source of greenhouse gas (GHG) emissions accounting for 69% of the total emissions in the country, due to the dependence on coal for power generation and high transmission and distribution losses. In 2022, Government of India updated its Nationally Determined Contribution to reduce carbon emission intensity of its GDP by 45% by 2030 from the level in 2005, through multiple actions including an increase in renewable energy capacity, and enhancing efficiency of transmission and distribution network.
The power distribution sector in India has been consistently identified as the weak link in the overall value chain for power supply in India. The power distribution companies (DISCOMs) underperform with high aggregate technical and commercial (AT&C) losses due to poorly maintained distribution networks, poor customer service, and weak financial performance with inadequate cost recovery. Despite an improvement in AT&C losses from 25.0% in 2015 to 21.5% in 2022 at the national level, further loss reduction requires to address (i) lack of metered connections to agricultural and residential consumers resulting in greater use of electricity than assumed for billing; (ii) an overloaded and suboptimal network design resulting in high technical losses; (iii) widespread illegal connections; (iv) poor billing and collection efficiency, especially from rural residential and agriculture consumers; and (v) delays in payment of electricity bills by government-controlled entities. The DISCOMs are also persistently facing financial loss due to (i) higher actual AT&C losses than the set level of AT&C losses as a norm, which constitutes the cost of supply to determine the aggregate revenue requirement, by the relevant state electricity regulatory commission, and (ii) lower level of tariffs for residential and agriculture consumers than full cost recovery because of political considerations. These have resulted in a gap between the average cost of supply (ACS) and average revenue realized (ARR), which was
0.93/kilowatt-hours (kWh) in 2022 (footnote 2) which translated to
530 billion of total financial loss.
In 2021, the Government of India launched the Revamped Distribution Sector Scheme (RDSS) to help DISCOMs (i) reduce AT&C loss to 1215%; (ii) eliminate the ACR-ARR gap; and (iii) improve quality and reliability of power supply to consumers. The RDSS provides results-linked financial support to DISCOMs based on achievement of performance benchmark targets and plans to be implemented from 2022 and 2026 with around
3,037 billion of total program cost. 55 DISCOMs in the country have been qualified to take part in the RDSS.
- Impact
Emission intensity in the national gross domestic product reduced by 45% by 2030 from the 2005 level (India's Updated First Nationally Determined Contribution Under Paris Agreement
Enhanced availability and reliability of uninterrupted power to all households, agriculture, and other power consumers achieved (Revamped Distribution Sector Scheme)
- Outcome
Access to efficient, reliable, and sustainable electricity supply in seven districts of West Bengal enhanced.
- Outputs
Power distribution network in seven districts strengthened
Institutional capacity for improved, sustainable, and green power supply delivery strengthened
Occupational and community health and safety capacity enhanced
Institutional capacities on GESI strengthened
- Geographical Location
- Nation-wide, West Bengal
Safeguard Categories
- Environment
- B
- Involuntary Resettlement
- B
- Indigenous Peoples
- C
Summary of Environmental and Social Aspects
- Environmental Aspects
- Involuntary Resettlement
- Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
- During Project Design
- During Project Implementation
Contact
- Responsible ADB Officer
- Sanda, Roka
- Responsible ADB Department
- South Asia Department
- Responsible ADB Division
- Energy Division, SARD
- Executing Agencies
-
Department of Power, Government of West Bengal
Timetable
- Concept Clearance
- 02 Apr 2024
- Fact Finding
- 01 Apr 2024 to 15 Apr 2024
- MRM
- 15 May 2024
- Approval
- -
- Last Review Mission
- -
- Last PDS Update
- 12 Apr 2024
Funding
Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.
The Access to Information Policy (AIP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.
The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.
In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.
None currently available.
Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.
| Title | Document Type | Document Date |
|---|---|---|
| West Bengal Distribution System Strengthening Program: Program Safeguard Systems Assessment | Program Safeguard Systems Assessments | Aug 2024 |
Evaluation Documents See also: Independent Evaluation
None currently available.
Related Publications
None currently available.
The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.
Requests for information may also be directed to the InfoUnit.
Tenders
Contracts Awarded
Procurement Plan
None currently available.