1. COMMUNITY PARTICIPATION IN ODISHA POWER DISTRIBUTION
Experience with WSHGs in Odisha DISCOMs 1

2. In this Presentation….. Why - Involve WSHGs as Franchisees?
What - has been done in this regard?
SEFA- GoO Scheme on WSHGs
What next - The Way forward 2

3. MANDATE FOR COMMUNITY PARTICIPATION IN POWER DISTRIBUTION
: A primary objective of OER Act’95 was enhancement of operational efficiency & loss reduction as distribution loss was 49.7% and AT&C loss was 65%.
Article 5 of The Electricity Act’2003 says that
“The Central Government shall formulate a national policy, in consultation with the State Government and the State Commissions, for …….management of local distribution in rural areas through Panchayat Institutions, users’ associations, co-operative societies, non-governmental organization or franchisees”
: Para 7.3 of The Rural Electrification Policy of GoI also envisaged deployment of franchisee for rural distribution network as follows:
“To ensure the revenue sustainability of the rural electricity supply, RGGVY requires deployment of franchisees for the management of rural distribution in projects financed under the Scheme ……. It is necessary that system of franchisee is implemented in phased manner by the State Governments in other areas also in order to bring down commercial losses, improve collection efficiency and to provide doorstep services to the consumers.” 3

4. Franchisees to improve Operational Efficiency
Section 14 of E.A provides for Deployment of Franchisees in a specified area of a Licensee within the area of Supply and for which no separate License is required
OERC RST Order for FY
“…..the DISCOMs should expeditiously finalize the franchisee system for newly created RE networks before taking over’’ (Para- 368)
OERC RST Order for FY
“Franchisee envisages participation of public in management of electricity and hence a linkage between people and the electricity provider of the area. Thus for effective collection and qualitative supply to the consumer franchisee activities needs to be encouraged. The Commission during performance review has given a target of introduction of at least one micro franchisee in a section. With approx 5 DTRs per franchisee and 100 consumers per DTR the target was to bring at least 500 consumers per section in each DISCOM…. ’’ (Para 641). 4

5. Concept of Using Women SHGs as FRANCHISEES
The SHG movement in Orissa has become almost synonymous with economic empowerment of women & economic development of the state
SHGs are important form of community in the rural areas of Orissa
Involvement of these groups also results in curbing local law and order problem while taking action against unauthorized users.
Using WSHGs as Franchisees offers income generating activities like meter reading, collection of electricity dues & providing new connections.
10% to 20% of income generated by these activities would go to a common pool to meet urgent needs of the group members, after paying 80% to 90% income to women members who carry out the actual works
SHGs as franchisees offer a WIN-WIN solution for both SHGs & electricity distribution utilities.

6. THE BEGINNING…..2009
A Seminar on ‘ Engaging Women SHGs as Franchisees in Electricity Distribution Business’ was organized on involving then Chairman of OERC, Members, Mission Sakti, Govt of Odisha
Decision taken to start the work first in Nayagarh in compliance with 10th Plan, RGGVY and its mandate.
Gram Panchayats were the units of the Franchisee area of a SHG
Involved a local NGO ‘SWIKRUTI’ for mobilizing SHGs to come to the Selection Committee Meeting, constituted with the representatives of CESU, BDO and NGO.
Selection of WSHGs carried out on the basis of scores assigned by Selection Committee on 12 parameters
Ist 3-Day Training Programme conducted from 18th to 20th June’2009

7. OBJECTIVE OF ENGAGING WOMEN SHGs
To reduce AT&C loss to a level of 15% through
- improvement in meter reading coverage & billing efficiency
- improvement of collection coverage & collection efficiency
- virtually creating a consumer service centre nearer to consumer
- creating consumer awareness on power theft & its impact on quality, reliability & tariff
To reduce cost of operations in rural areas 7

8. AREAS FOR FRANCHISEE OPERATIONS
Franchisees in Rural & Semi-Urban areas
- Areas under RGGVY/DDUGJY
- Loss prone sections /sub-divisions or
divisions where AT&C loss is more than 60%
Government of Odisha decided to start a programme called:
“ SHG ENERGY FRANCHISE ARRANGEMENT” (SEFA) 8

9. SHG selection process IN FY 2010-11
Mission Sakti and Federations were contacted for SHG list
ICDS Supervisor to intimate details of the selection process to the SHG members in the sector meeting
Applications from the interested SHGs collected
Screening of applications
Selection of SHGs

10. SELECTION CRITERIA WITH WEIGHTAGE
1. Gradation of SHG as per Government list -60%
2. Registration No.-3%
3. Qualification of members (at least two members should be able to read & write English: +2 pass and above) – 3%
4. Age of SHG-3%
5. Activities undertaken by SHG for at least last two years -3%
6. Amount of Saving – 3%
7. Linkage with Bank (which bank & since when)- 3%
8. Amount of loan taken by the SHG- 3%
9. Awards received by SHG -3%
10. Amount of money available in bank- 3%
11.Rotational Leadership -3%
12 Managerial Capability – 10%

11. Nayagarh Experience Scenario 2010 Scenario 2017 Distribution loss- 56%
Distribution loss – 27% (Reduced by 29%)
AT & C loss- 61%
AT & C loss- 31 % (Reduction by 30%)
Collection Efficiency- 92%
Collection Efficiency- 95%
Collection- Rs crore
Collection- Rs crore
LT Realization per unit- Rs.0.99
LT Realization per unit- Rs.2.66
For Last Four Years, highest AT&C Loss Reduction among all the 20 -Divisions

12. Salient Features of Agreement…
6% on collection, additional incentive of 1% to 2%, if net collection above 80%
Rs.3 per meter reading, but additional Rs. 5/- per bill for more no. of consumers than targeted (which is the average value of last 6 months)
Rs.10/- per new connection added to billing fold
Reward given from penal amount recovered from unauthorized consumers
Additional Incentive by providing Rs 1000/- extra or gifts such as Pressure Cooker, etc, if no. of billing days reduced
Focus is on improving billing coverage & completing in less no. of days, ensuring more days for collection ( 7th to 15th is billing days)
3- additional personnel engaged specifically to monitor activities of SHGs, besides normal employees working in Sections, Sub-divisions and Divisions

13. Guidelines of this Arrangement
Block Level
A block level preparatory programme will be conducted involving CDPO, ICDS Supervisor, Project officers of Mission Shakti, TRIPTI officials (wherever applicable).
A selection committee will be constituted under the chairmanship of Block Development Officer with Executive Engineer of DISCOM & CDPO as members. Block level SHG federation will be involved in the scrutiny of applications & selection of groups will be done by the above committee.
The following steps will be taken for selection of SHGs
ICDS Supervisor will intimate the details of the selection process to the SHGs member in the sector meeting
Applications from the interested SHGs to be collected
Screening of applications
Selection of SHGs

14. Guidelines of this Arrangement
SEFA Module I :
Orientation Programme at Central level
Objective : To sensitize all the stakeholders about the programme
SEFA Module II :
Training of Trainers (ToT)
Objective : To sensitize about this programme & how to make it happen down below ?
SEFA Module III :
Training at District level
Objective : To sensitize about the selection process of WSHG among the district & DISCOM officials & ensure the completion of selection process
SEFA Module IV : Training at Block Level (Preparatory Programme)
Objective : To prepare an action plan for selection of suitable WSHGs
It is a Preparatory Programme on
How to Create Awareness Among the WSHGs ?
How to Get Applications From WSHGs ?
How to Select good WSHGs as franchisees ?
How To select suitable WSHG?
SEFA Modul V : Training of SHGs
Objective : To train two members from a selected WSHG on meter reading through SBMs, collection of dues from its consumers & redress the consumer grievances etc.

15. Way Forward
Community Participation is the only way forward for increasing operational efficiency & curbing power theft through mobilization of general public opinion
As seen from the experience of CESU and FEDCO, WSHGs are an effective tool to involve local communities in power distribution
GPs can be involved in the process of selecting WSHGs thereby taking ownership of power distribution issues in their locality
A Facilitating Agency (FA) can help in carrying out activities of SHG Selection, training, development, monitoring & providing feedback on regular basis to enhance their performance
The OERC has decided to scale up community participation in rural power distribution in the State
A high level meeting of various stakeholders including Secretaries Energy, Rural Development, Panchayati Raj, Mission Shakti & Odisha Livelihood Mission & CEO, CESU was convened at OERC on to discuss the issue
As per its deliberations, amendments were made to existing SEFA scheme by a committee after studying the Nayagarh experiment
3 Electrical Sub Divisions from each Distcom area have been selected to deploy WSHGS FOR rural power distribution management

16. Thanking you