Suresh Prabhu Intends to Save Up to Rs 3,000 Cr Per Year With this Simple Policy Hack

November 12, 2016 

ASEEM GAURAV SHARMA

Chief Sub-Editor 

The Indian Railways is planning to procure electricity directly from the generator of its choice.

Railway Minister Suresh PrabhuTwitter/Suresh PrabhuWith this Railway Minister Suresh Prabhu is targeting a savings of Rs 3,000 crore per annum through the open access of electricity.

Indian Railways has long been a bulk procurer of electricity from different states but the state-owned distribution companies have been charging the national transporter at industrial rates. This meant the Railways paying for electricity nearly double the rates commercially available in the market, thus inflating its cost.

So far the ministry has received clearances from BJP-ruled states of Maharashtra, Gujarat, Madhya Pradesh and Jharkhand. The Railways is in talks with other states to have their clearances to draw power from these states’ transmission lines.

business-standardRailways is the largest energy consumer in the country with about 2.8 billion litres of diesel and 17.5 billion units of electricity a year. While the diesel cost is Rs 18,000 crore a year, the power bill is around Rs 12,300 crore. After the salary and pension, the energy bill is the highest expenditure in railways, Mital said.

After the salary and pension, the energy bill is the highest expenditure in railways, according to Railway Board Chairman A K Mital.

Twitter/Suresh Prabhu

In addition, the national carrier is also planning to import crude oil directly and refine it at Indian Oil Corporation’s (IOC) Vadodara unit.By having open access of electricity and crude oil imports, the Railways look to save Rs 35,000 crore on fuel bill in next 10 years.