The plan outlay of Central PSUs in the power ministry is estimated to be nearly 14 per cent higher in FY25, as envisaged in the Interim Budget 2024.
The Budget has estimated that the aggregate plan outlay of eight CPSUs under the power ministry would be Rs.67,286.01 crore in FY25, translating to a 13.8 per cent growth over the FY24 (RE) of Rs.59,119.55 crore. (See table). The plan outlay of a CPSU can be interpreted as its capital expenditure.
This plan outlay will be entirely financed by the respective CPSUs through internal and extra-budgetary resources (IEBR), without any budgetary support envisaged.
Power Grid Corporation of India Ltd (PGCIL) is expected to have a plan outlay of Rs.12,250 crore in FY25 that would be nearly 40 per cent higher than the FY24 (RE) of Rs.8,800 crore. The actual capital expenditure incurred by PGCIL in FY23 was Rs.8,850 crore.
According to information available with T&D India, PGCIL’s plan outlay of Rs.12,250 crore for FY25 assumes significance as it would be the first time in recent history that PGCIL’s capex would breach the Rs.10,000-crore mark.
As of September 30, 2024, PGCIL had an estimated Rs.50,500 crore of work in hand, half of which was through new projects awarded under the RTM (regulated tariff mechanism) route. An important project on which PGCIL is expected to start work in FY25 is the Ladakh HVDC project on which the company has already initiated FEED studies.
NTPC has a plan outlay of Rs.22,700 crore in FY25 as against the RE of Rs.22,454 crore in FY24 – a modest 1.1 per cent growth. Among all power CPSUs, NTPC would have the highest plan outlay in FY25, followed by PGCIL, SJVN and NHPC.
RDSS get highest allocation
The Centre has budgeted Rs.16,362 crore for Centrally-sponsored schemes under the power ministry in FY25. Almost the entire amount will be towards revenue expenditure, with capital expenditure accounting for a negligible Rs.1 crore. Compared to FY24 (RE), the allocation for Central power sector schemes would be 17.5 per cent higher.
The Revamped Distribution Sector Scheme (RDSS), launched in July 2021, has the highest allocation of Rs.14,500 crore in FY25 – up 39 per cent from Rs.10,400 crore in FY24 (RE). It is also seen that the expenditure on RDSS in FY24 is likely to fall short by around 14 per cent from the then budgeted Rs.12,071.60 crore [FY24(BE)].
It may be mentioned that erstwhile Centrally-sponsored power sector schemes like IPDS and DDUGJY have been subsumed under RDSS.
The Budget has provided, for the first time, a sum of Rs.96 crore towards viability gap funding (VGF) for battery energy storage systems (BESS), which follows from the approval of such a scheme by the Union Cabinet in September 2023.
It may be mentioned that the approved scheme envisages development of 4,000 MWh of BESS projects by FY31, with a financial support of up to 40 per cent of the capital cost as budgetary support in the form of VGF. The scheme has an initial total outlay of Rs.9,400 crore, including budgetary support of Rs.3,760 crore of which the Rs.96 crore discussed above would form part. The VGF would be disbursed in five tranches linked with the various stages of implementation of BESS projects.
Featured photograph (source: Madhya Pradesh Power Transmission Company Ltd) is for representation only.
