Power play: Kerala govt to scrap Centre’s prepaid smart meter project

The decision to scrap the smart meter project, part of the Union government’s Revamped Distribution Sector Scheme (RDSS), was taken at a high-level meeting chaired by Chief Minister Pinarayi Vijayan.

An official communication issued by the CMO after the meeting stated, “The state would examine the possibility of implementing the prepaid smart meter project with a lower cost compared to the scheme proposed by the Union government. Smart meters would be established without harming the interests of the common people. The TOTEX model would be abandoned.’’

It said trade unions had strong objections towards implementation of the smart meter project under the TOTEX model, which envisaged entrusting the maintenance and operation of the smart meters with a single agency.

Government sources said the decision taken under the pressure of trade unions may deprive the state of an assistance of Rs 20,000 crore for revamping the electricity distribution network and smart meter project under the RDSS scheme.

“Of the Rs 20,000 crore project, the state was entitled to get Rs 10,000 crore as subsidy. Implementing the smart meter scheme under the TOTEX model was one of the conditions fixed by the Centre for releasing the financial assistance for power sector development and reforms,’’ a source said.

The CMO said under the new scheme envisaged by the State government to implement the smart meter project, KSEB would develop software for billing and related services. KSEB can make use of the optical fibre cable network of Kerala Fibre Optical Network (KFON) for communication purposes and data management would be done by the KSEB data centre. The electricity board employees would take up the task of replacing the existing meters with prepaid smart meters. In the first phase, the smart meter scheme would be implemented for commercial consumers, numbering less than 3 lakh, it said in the official communication.

The TOTEX scheme was designed in such a manner to levy the cost of the smart meters, including its maintenance, on the consumers in 93 monthly instalments. A single agency was to be contracted for supplying, maintaining and operating the metering infrastructure.

KSEB sources said the belligerent stand of the trade unions against TOTEX would only add to the burden of the consumers in the state. “If Kerala agreed to the TOTEX model, KSEB could have implemented the smart meter project with assistance from the Centre. The decision to abandon the TOTEX model would put the entire financial burden of the smart meter scheme on KSEB, which would be forced to hike power bills to mobilise the required resources,’’ the source said.

Earlier, Kerala has submitted to the Centre a project worth Rs 3,800 crore for distribution revamp and Rs 8,200 crore for smart meters. With the decision to abandon the TOTEX scheme, the KSEB would make a fresh proposal seeking financial aid for its own smart meter project.

The Centre has launched the RDSS across the country with an outlay of Rs 3,03,758 crore. The project has two components: revamping the distribution network and smart meter implementation. Power lines and distribution systems will be modernized, while financial assistance will be given to distribution companies (in Kerala, it is the KSEB) for the upgrade of the distribution infrastructure and for the installation of prepaid smart consumer meters. The project has an estimated gross budgetary support of Rs 97,631 crore from the Union government for a duration of five years — FY 2021-22 to FY 2025-26.