Agriculture Electricity Cash Transfer Scheme, Andhra Pradesh

On September 1, 2020, Andhra Pradesh government issued guidelines regarding Agriculture Electricity Cash Transfer Scheme, which is planned to be launched in the state. This scheme is about to be implemented from the financial year 2021-22. Under this scheme free power supply will be provided to the agriculture sector. All the processing will be done virtually. Government will install smart meters to all agricultural power connections and the bill amount will be credited to the bank accounts of the farmers. Thereby ‘The farmers need not have to pay a single rupee from their pockets’ says Mr. N. Srikant, Energy Secretary, Andhra Pradesh.

Scheme Overview:

Scheme Objectives and Benefits:

• The main objective of the scheme is to benefit the farming sector
• It aims at providing assistance in electricity bill payment
• This scheme will enable free power supply to the agricultural sector
• This will lessen the financial burden on the farmers
• It will enable the farmers to use this scheme’s benefit along with the already existing free power scheme

Scheme Details:

• The scheme will be available to all the farmers across the state
• Government will set up smart meters to all the agricultural power connections. Estimated cost of this installation is Rs. 1,500 crores
• This installation will be as a part of centre suggested reforms which will enable a 2% hike in the borrowing limit under FRBM act up to an additional amount of Rs. 20,000 crores to the state as loan.
• Under this scheme, farmers will be required to open separate bank accounts
• Government will credit the bill amount directly to these bank accounts
• Accordingly, the farmer will pay the same amount to the applicable power distribution company in the area.
• Farmers will not have to pay their own money, rather government will pay for it.

Key Points:

• Agriculture electricity cash transfer scheme is about to be implemented from the year 2021-22
• Andhra Pradesh government has estimated the bill expenditure as about Rs. 8,400 crores per annum.
• This scheme will function as aligned with the already existing Free power scheme.
• Free power scheme was introduced in 2004 and is functioning since then.
• Currently 10,000 MW solar power plants are being developed under the existing government so as to provide free power to the agricultural sector for the next 30 years.
• Government was spending Rs. 1700 crores to improve the transmission system so as to supply power for 9 hours during daytime.
• Agriculture Minister stated that, there won’t be any change in the existing free power scheme.
• In 2020-21 the agriculture power connections were 18.72 lakhs by the end of March but the current order states that the total is 17.55 lakhs.