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New Delhi, The Government has proposed to free both <keyword id="913456" type="COMPANY" weightage="20" keywordseo="power-producers">power producers</keyword> and consumers from continuing with contracted obligation once the tenure of a power purchase agreement expires. The move is expected to provide flexibility to both procurers (mainly <keyword id="53091" type="COMPANY" weightage="20" keywordseo="discoms">Discoms</keyword>) and generators (<keyword id="98684" type="PERSON" weightage="20" keywordseo="power-projects">power projects</keyword>) to look for <keyword id="10462072" type="UNKNOWN" weightage="20" keywordseo="meaning-contracts-post-expiry">meaning contracts post expiry</keyword> of a PPA, one where discoms can get the option to buy cheaper power available in the market while generators could look at new consumers either under <keyword id="10462074" type="UNKNOWN" weightage="20" keywordseo="long-term-contract">long term contract</keyword> or through price discovery on exchanges. The changes have been brought out by <keyword id="10462076" type="COMPANY" weightage="20" keywordseo="the-power-ministry-through-draft-proposals">the power ministry through draft proposals</keyword> on which is it seeking <keyword id="10462075" type="UNKNOWN" weightage="20" keywordseo="stakeholders-comments">stakeholders comments</keyword> before regulations could be finalised. The stakeholders have been asked to submit their comments suggestions by December 24, 2020. In its proposal, the ministry has said that states with long-term PPAs with the interstate central generating stations, whose tariff is determined by the Commission, and which are due to expire in the future, can choose to give up the contracted power after the completion of the PPA tenure of 25 years. Such a mechanism could be availed by the states procuring relatively costlier power from the central generating stations. Also, states looking to convert their long term PPA into shorter term agreements or look to buy power from exchanges to meet exigencies could also relinquish PPA after expiry of its tenure. <keyword id="6375040" type="UNKNOWN" weightage="20" keywordseo="power-ministry">Power ministry</keyword> officials said that the proposed guidelines would also help in making power generation more efficient as generators knowing that their contracts could be rescinded would strive to make their projects more competitive. Also, with PPAs being freed up, such surplus power would be available for deficit states at competitive price. Under the proposed regulations, the first right of refusal would test with discoms meaning contracted power will be freed only with the consent of discoms. Also, discoms looking to end PPAs would serve at least three month notice to generators to help them prepare for the situation. SEE ALSO: <a href="https://www.businessinsider.in/business/news/ikea-india-cfo-says-she-still-has-3500-crore-to-be-spent-in-india-the-pandemic-has-changed-targets-but-not-the-investment-plan/articleshow/79790938.cms">INTERVIEW: Ikea CFO says she still has ₹3,500 crore to be spent in India⁠— the pandemic has changed targets but not the investment plan</a> <a href="https://www.businessinsider.in/science/health/news/india-will-produce-300-million-doses-of-the-russian-sputnik-v-covid-19-vaccine-next-year/articleshow/79795341.cms">India will produce 300 million doses of the Russian Sputnik V COVID-19 vaccine next year</a> <a href="https://www.businessinsider.in/stock-market/news/how-to-check-mrs-bectors-food-specialities-ipo-allotment-status-online/articleshow/79808672.cms">Mrs Bectors Food Specialities IPO allotment: Here’s how to check share allotment status</a>

Government to offer flexibility to discoms to end long term power contracts

New Delhi, Jul 5 () To ensure seamless power supply to the world's "largest" COVID-19 care centre here in a "record time", more than 100 workers and officials of discom BRPL worked round the clock to lay 22-km-long cable underground and install 24 transformers for a load of 23 MW, its spokesperson said on Sunday. The 10,000-bed Sardar Patel Covid Care Centre in south Delhi was inaugurated by Lieutenant Governor Anil Baijal on Sunday. "The (electrification) task was completed in a record time of nearly 15 days with over 100 discom officials and workers toiling round the clock under the direct supervision of the company' senior leadership team and in close coordination with government agencies," said the BSES Rajdhani Power Limited(BRPL) spokesperson. The transmission chain involved laying 22-km-long cable underground and installing 24 transformers for a load of 23 MW, he said. Initially, BRPL had been entrusted with providing an electricity supply load of 18 MW, but the power load was subsequently increased to 23 MW looking at the requirements, he said. In order to ensure safety of the premises, most of the transformers set up there are dry-type, which don't have requirement of oil and are maintenance free. Also, to keep the electricity infrastructure free from waterlogging during the monsoon, four water-pumps have been installed, said the spokesperson. The power lines at the facility conform to the best international standards and will be remotely controlled from the Supervisory Control and Data Access (SCADA) centre in Kalkaji. The distribution infrastructure will also be scanned using hot-spot technology and load balancing to prevent faults, he said. A quick response team (QRT) with senior engineers has been stationed at the premises 24X7 to take care of any contingency, he added. The care centre, set up on the Radha Soami Satsang Beas compound in Chhatarpur, will treat mild and asymptomatic coronavirus patients. Authorities say it is the largest of its kind in the world. While the Delhi government has provided administrative support, the Indo-Tibetan Border Police (ITBP) will be the nodal agency operating the centre. VIT SMN SMN

Electrification work at world's 'largest' COVID care centre completed in record time: Discom

New Delhi, Apr 19 () The Union Cabinet is likely to approve next week a package for discoms reeling under revenue loss due to lower power demand amid the coronavirus lockdown, including setting up of an alternative investment fund to pay off their dues towards electricity generation companies, a source said. "The Cabinet in the coming week can approve a package for power distribution utilities (discoms) which are under stress due to lower demand and cash crunch," the source said. "The package may include creating an alternate investment fund to pay off dues on behalf of the discoms to gencos. The discoms may be charged nominal interest rate and administrative expenses on that," he added. The package may also include steps like directions to the state and central power regulators to reduce electricity traiff, the source sai. The payment of dues would help distribution companies (discoms) to increase their electricity load (supplies) and ensure 24X7 uninterrupted power supply. According to government data, discoms owe Rs 92,602 crore to power generation companies (gencos) as of February this year. A report by industry body CII had said discoms are likely to suffer a net revenue loss of around Rs 30,000 crore and liquidity crunch of about Rs 50,000 crore due to the coronavirus-induced nationwide lockdown. In its report released on Friday, CII had suggested host of measures like easy credit facility for discoms (from PFC and REC) to pay off its dues to gencos, lower tariff especially for industrial and commercial consumers and deferral of indirect taxes like electricity duty and coal cess. It said the power sector, one of the essential services under the lockdown till May 3, is battling the twin issues of demand and liquidity compression. Latest data from Power System Operation Corporation Ltd (POSOCO) indicated that total demand per week between March 23 and April 12 was 18 BU (billion units), compared to 23 BU during the week of March 9-15 (before 'Janata Curfew' and lockdown) -- a 25-28 per cent reduction in demand. Further extension of the lockdown could result in additional demand compression of 15 to 20 BU, implying a net revenue loss of Rs 25,000 to Rs 30,000 crore for the discoms, it had said. This will further increase the liquidity crunch to Rs 45,000 to 50,000 crore, in addition to the Rs 90,000 crore dues pending by the discoms to generating companies pre-lockdown. Earlier in the week, Renewable Energy Secretary Anand Kumar had said, "We are planning to create an alternative investment fund that will help to give load and financial support to discoms and clear the due to be paid to developers and generators. Our effort is to release maximum due payments from discoms to the power generators," "We want to make sure that our power supply and renewable power are protected and not compromised. We tried to clear all the financial dues of the generators and developers to enhance the capital available with them," Kumar had said during a webinar. KKS ABM

Cabinet likely to okay package for power discoms reeling under revenue loss in lockdown

New Delhi, Dec 3 () Union Power Minister R K Singh on Tuesday said in the Rajya Sabha that state government departments owe about Rs 41,700 crore to power distribution companies and asked states to ensure payments are made on time.
 The minister also informed that aggregate technical and commercial (AT&amp;C) losses have come down to about 18 per cent from 22 per cent.
 "As a result of UDAY, some improvement has happened. The losses in AT&amp;C have come down from 22 per cent to about 18 per cent. So there has been some progress, though the progress could have been better," Singh said.
 The minister said the Centre would work together with states to bring down losses of power discoms, which are with state governments.
 He said most of the discoms are filing revision in tariff on time to take care of inflation and risng input cost.
 "Barring one or two discoms, most of them have filed on time. Although in many cases, revision has not taken place," he said.
 The minister attributed the losses in discoms to theft, inefficiencies in billing and collection by distribution companies, and government departments not paying their dues on time.
 "Total dues against government departments of states is Rs 41,700 crore and loss (of discoms) in 2018-19 is Rs 27,000 crore. I have written to states, they must make sure that the government departments pay on time," Singh said.
 He said the government announces subsidy for various categories of people and this subsidy should be paid upfront to distribution companies.
 However, he said, the states do not follow this rule and pay partial subsidy amount.
 To reduce losses of discoms, the minister said states have been asked to adopt smart pre-paid metres in the next three years, and informed that 7.5 lakh such metres have been installed in Uttar Pradesh.
 State government departments should also install smart pre-paid metres, he said. MJH RVK

State govt departments owe Rs 41,700 cr to discoms: Power Minister

New Delhi, Mar 29 () Power producers' total outstanding dues owed by distribution firms rose nearly 32 per cent to Rs 88,311 crore in January 2020 over the same month previous year, reflecting stress in the sector.Distribution companies (discoms) owed a total of Rs 67,012 crore to power generation companies in January 2019, according to portal PRAA (Payment Ratification And Analysis in Power procurement for bringing Transparency in Invoicing of generators).The portal was launched in May 2018 to bring in transparency in power purchase transactions between the generators and discoms.In January 2020, the total overdue amount, which was not cleared even after 60 days of grace period offered by generators, stood at Rs 76,192 crore as against Rs 51,453 crore in the same month of the preceding year. According to the latest data on the portal, outstanding dues in January has decreased over the preceding month. In December 2019, the total dues of discoms stood at Rs 86,948 crore.However, the overdue amount in January increased over the preceding month, from Rs 75,930 crore in December 2019.Power producers give 60 days to discoms for paying bills for the supply of electricity. After that, outstanding dues become overdue and generators charge penal interest on that in most cases.In order to give relief to power generation companies (gencos), the Centre enforced a payment security mechanism from August 1, 2019. Under this mechanism, discoms are required to open letters of credit for getting power supply.The central government has given three months moratorium to discoms for paying dues to power generating companies (gencos) in view of lockdown till April 14 to contain COVID-19 across the country. The government has also waived off the penal charges for late payment of dues in the directive issued earlier this week.Discoms in Rajasthan, Uttar Pradesh, Jammu &amp; Kashmir, Telangana, Andhra Pradesh, Karnataka and Tamil Nadu account for the major portion of dues to power gencos, the data showed.Overdues of independent power producers amount to 25.94 per cent of the total overdue of Rs 76,192 crore of discoms in January. The proportion of PSU gencos in the overdue was 39 per cent.Among the central public sector power generators, the NTPC alone has an overdue amount of Rs 11,007.50 crore on discoms, followed by NLC India at Rs 4,731.13 crore, Damodar Valley Corporation at Rs 4,614.49 crore, NHPC at Rs 2,548.85 crore and THDC India at Rs 2,129.53 crore.Among private generators, discoms owe the highest overdue of 3,421.68 crore to RKMP (RKM Powergen Pvt Ltd) followed by Adani Power at Rs 3,201.68 crore, Bajaj Group-owned Lalitpur Power Generation Company Ltd at Rs 2,212.66 crore and GMR at Rs 1,930.16 crore.The overdue of non-conventional energy producers like solar and wind, stood at Rs 6,618.20 crore in January. KKS KKS BALBAL

Discoms' outstanding dues to power gencos rise nearly 32 pc to Rs 88,311 cr in Jan

New Delhi, Jan 5 () Power producers' total outstanding dues owed by distribution companies increased around 45 per cent to Rs 81,085 crore in November 2019 over the same month previous year, reflecting stress in the sector.
 Distribution companies (discoms) owed a total of Rs 54,834 crore to power generation companies in November 2018, according to portal PRAA (Payment Ratification And Analysis in Power procurement for bringing Transparency in Invoicing of generators).
 The portal was launched in May 2018 to bring in transparency in power purchase transactions between generators and discoms.
 In November 2019, the total overdue amount, which was not cleared even after 60 days of grace period offered by generators, stood at Rs 71,782 crore as against Rs 41,503 crore in the same month of the preceding year.
 Power producers give 60 days to discoms for paying bills for the supply of electricity. After that, outstanding dues become overdue and generators charge penal interest on that in most cases.
 In order to give relief to power generation companies (gencos), the Centre enforced a payment security mechanism from August 1. Under this mechanism, discoms are required to open letters of credit for getting power supply.
 According to the latest data on the portal, outstanding dues in November has increased over the preceding month. In October 2019, total outstanding dues on discoms stood at Rs 80,635 crore.
 The overdue amount in November has also increased over the preceding month. The total overdue amount was Rs 70,477 crore in October 2019.
Discoms in Rajasthan, Jammu &amp; Kashmir, Telangana, Andhra Pradesh, Karnataka and Tamil Nadu account for the major portion of dues to power gencos, taking a longer duration of up to 943 days to make payments, the data showed.
 Among major states, Andhra Pradesh tops the list with 943 days to make payments, followed by Rajasthan (942 days), Bihar (942 days), Haryana (940 days), Tamil Nadu (938 days), Madhya Pradesh (927 days) and Telangana (920 days).
 Delhi takes 969 days to make payments to power gencos.
 Overdues of independent power producers amount to over 26 per cent of the total overdue of Rs 71,782 crore on discoms in November 2019.
 Among the central public sector power generators, NTPC alone has an overdue amount of Rs 12,483.16 crore on discoms, followed by NLC India at Rs 4,380.22 crore, NHPC at Rs 3,165.11 crore, THDC India at Rs 2,078.30 crore and Damodar Valley Corporation at Rs 936.59 crore.
 Among private generators, discoms owe the highest overdue of Rs 3,201.68 crore to Adani Power, followed by Bajaj Group-owned Lalitpur Power Generation Company Ltd at Rs 2,212.66 crore and GMR at Rs 1,930.16 crore. KKS ABM

Discoms' outstanding dues to power gencos rise 45 pc to Rs 81,085 cr in Nov

Mumbai, May 11 () If the economic activities continue to get impacted for the next four months amid COVID-19 crisis, the regulatory assets of power discoms will increase to up to Rs 90,000 crore, which will then have to be recovered from consumers, an industry expert has said. Regulatory assets in the power sector include previously-incurred losses that are in the nature of deferred expenditure and can be recovered from consumers in future provided allowed by regulatory authorities."Everyone talks about 25-30 per cent dip in demand, but what constitutes behind that is nearly 80-82 per cent is decline in demand from the commercial sector and there is a rise in domestic consumer demand which is subsidised," Adani Transmission CEO Anil Sardana said during a webinar organised by Care Ratings. Whereas the industrial and commercial are the subsidising customers, he said adding that therefore, subsidising revenue has gone down while the subsidised customers are high.According to him, if the situation continues for two months, there will be nearly Rs 30,000-40,000 crore worth of regulatory assets."However, if this continues for four months which is estimated in terms of demand at least, because the industry will actually take time to start to consume as much, that (regulatory assets) would be Rs 80,000-90,000 crore, which is going to reflect in the ARR of the discoms as regulatory assets," he said.Sardana further said that this means a tremendous amount of carrying cost over the next 4-5 years and consumers will see regulatory asset surcharge, and tariffs will have to be paid along with carrying cost which will be a steep burden on customers."The government has announced a Rs 90,000 crore credit line to fund discoms afresh, but what is important is to revive the economy. And for this, the government will have to address key issues of the construction, labour and logistics sectors," Sardana added.He further said that there are thousands of crores of rupees with the government agencies stuck in arbitration which they need to release to ensure that the construction industry survive as liquidity is a key challenge. "Liquidity crisis is not a pandemic related situation but has been impacting the sector even before that. Instead of giving stimulus package, we want the government to at least release the amount stuck in arbitration," he added. PSK HV MKJMKJ

Regulatory assets of discoms may touch Rs 90,000 cr if economy stalls for another 4 mths: Expert

New Delhi, Dec 15 () Power producers' total outstanding dues owed by distribution companies rose around 48 per cent to Rs 81,010 crore in October 2019 over the same month last year, reflecting stress in the sector.
 Distribution companies (discoms) owed a total of Rs 54,654 crore to power generation companies in October 2018, according to portal PRAA (Payment Ratification And Analysis in Power procurement for bringing Transparency in Invoicing of generators).
 The portal was launched in May 2018 to bring in transparency in power purchase transactions between generators and discoms.
 In October this year, the total overdue amount, which was not cleared even after 60 days of grace period offered by generators, stood at Rs 67,143 crore as against Rs 39,338 crore in the same month last year.
 Power producers give 60 days to discoms for paying bills for the supply of electricity. After that, outstanding dues become overdue and generators charge penal interest on that in most cases.
 In order to give relief to power generation companies (gencos), the Centre enforced a payment security mechanism from August 1. Under this mechanism, discoms are required to open letters of credit for getting power supply.
 According to the latest data on the portal, outstanding dues in October has decreased over the preceding month. In September 2019, total outstanding dues on discoms stood at Rs 82,548 crore.
 However, the overdue amount in October has increased over preceding month of September. The total overdue amount was Rs 65,155 crore in September.
 The September 2019 figures of dues and overdues have been revised upwards from Rs 69,558 crore and Rs 52,408 crore provisional numbers released last month on the portal.
 Discoms in Rajasthan, Jammu &amp; Kashmir, Telangana, Andhra Pradesh, Karnataka and Tamil Nadu account for the major portion of dues to power gencos, taking a longer duration of up to 913 days to make payments, the data showed.
 Among major states, Andhra Pradesh tops the list with 913 days to make payments, followed by Rajasthan (912 days), Bihar (912 days), Haryana (910 days), Tamil Nadu (908 days), Madhya Pradesh (897 days) and Telangana (890 days) in that order.
 Delhi, a smaller state, takes 939 days to make payments to power gencos.
 Overdues of independent power producers amount to over 22.46 per cent of the total overdue of Rs 67,143 crore on discoms.
 Among the central public sector power generators, NTPC alone has an overdue amount of Rs 12,271.75 crore on discoms, followed by NLC India at Rs 4,413.94 crore, NHPC at Rs 3,178.42 crore, THDC India at Rs 1,883.54 crore and Damodar Valley Corporation at Rs 870.92 crore.
 Among private generators, discoms owe the highest overdue of Rs 3,201.68 crore to Adani Power, followed by Bajaj Group-owned Lalitpur Power Generation Company Ltd at Rs 2,212.66 crore and GMR at Rs 1,930.16 crore. KKS HRS

Discoms' outstanding dues to power gencos rise 48 pc to Rs 81,010 crore in October

New Delhi, Feb 16 () Power producers' total outstanding dues owed by distribution firms jumped nearly 50 per cent to Rs 88,177 crore in December 2019 over the same month previous year, reflecting stress in the sector.Distribution companies (discoms) owed a total of Rs 59,015 crore to power generation companies in December 2018, according to portal PRAA (Payment Ratification And Analysis in Power procurement for bringing Transparency in Invoicing of generators).The portal was launched in May 2018 to bring in transparency in power purchase transactions between the generators and discoms.In December 2019, the total overdue amount, which was not cleared even after 60 days of grace period offered by generators, stood at Rs 78,174 crore as against Rs 44,464 crore in the same month of the preceding year.Power producers give 60 days to discoms for paying bills for the supply of electricity. After that, outstanding dues become overdue and generators charge penal interest on that in most cases.In order to give relief to power generation companies (gencos), the Centre enforced a payment security mechanism from August 1, 2019. Under this mechanism, discoms are required to open letters of credit for getting power supply.According to the latest data on the portal, outstanding dues in December has also increased over the preceding month. In November 2019, total outstanding dues on discoms stood at Rs 82,414 crore.The overdue amount in November has also increased over the preceding month. The total overdue amount was Rs 73,175 crore in November 2019.Discoms in Rajasthan, Uttar Pradesh, Jammu &amp; Kashmir, Telangana, Andhra Pradesh, Karnataka and Tamil Nadu account for the major portion of dues to power gencos, the data showed.Overdues of independent power producers amount to 25.45 per cent of the total overdue of Rs 78,174 crore on discoms in December.Among the central public sector power generators, NTPC alone has an overdue amount of Rs 15,695.65 crore on discoms, followed by NLC India at Rs 5,010.69 crore, NHPC at Rs 3,165.09 crore, THDC India at Rs 2,136.30 crore and Damodar Valley Corporation at Rs 822.09 crore.Among private generators, discoms owe the highest overdue of Rs 3,201.68 crore to Adani Power, followed by Bajaj Group-owned Lalitpur Power Generation Company Ltd at Rs 2,212.66 crore and GMR at Rs 1,930.16 crore.The overdue of non-conventional energy producers like solar and wind, stood at Rs 6,739.47 crore in December. KKS BAL

Discoms' outstanding dues to power gencos rise nearly 50 pc to Rs 88,177 cr in Dec

<ul><li>The <keyword id="44011" type="CITY" weightage="20" keywordseo="power">power</keyword> sector roughly constitutes 20% of all the bad loans on the balance sheets of Indian banks. </li><li>While the resolution of stressed power assets is an urgent priority, the government is also preparing <keyword id="6447217" type="UNKNOWN" weightage="20" keywordseo="reforms">reforms</keyword> to ensure the long-term viability of the sector. </li><li>These include the implementation of a <keyword id="6357205" type="UNKNOWN" weightage="20" keywordseo="direct-benefit-transfer">direct benefit transfer</keyword> scheme for consumer subsidies and the separation of production and distribution operations of power companies. </li></ul>Much has been made of the growing pile of non-performing assets emanating from India’s power sector. A number of power companies such as Jindal India Thermal Power and Lanco Anpara are expected to be referred to insolvency courts following the expiry of a deadline for the resolution of ₹1.7 trillion worth of bad loans from the sector. This is roughly 20% of all the bad loans on the balance sheets of India’s banks. Recognising the problems that are unique to the power sector - like a liquidity crunch and a dearth of power-purchase agreements - and the need to ensure these coal-fuelled projects don’t undergo liquidation, the Indian government is planning to establish <a href="https://www.livemint.com/Industry/H2ttLugifLjwv91QYdnPFM/REC-to-seek-central-banks-nod-for-Pariwartan-ARC.html">an asset reconstruction company</a> (ARC) to resolve stressed power assets. Under its Pariwartan scheme, the state-owned Rural Electrification Corp will set up the ARC to clean up the sector in anticipation of a future revival in demand. Bigger reforms in the works However, the power sector’s problems go well beyond bad loans. While the resolution of bad loans is an urgent priority, the Indian government is also planning to implement a series of reforms to ensure the long-term viability of the sector and its participants. A number of amendments to the Electricity Act of 2003 are in the works. First, the government is looking to establish a direct benefit transfer (DBT) scheme for the targeted distribution of subsidies. The reason power producers and distribution companies are racking up so much debt is because state governments aren’t being able to allocate subsidies to consumers efficiently. A DBT will see the subsidy amount deposited in the bank account of a consumer. Second, the government is also looking to mandate the separation of production and supply operations of power companies, which means that power producers will not supply the electricity they generate. This reduces the complexity of operations and also gives consumers greater choice. Third, it also plans to exempt <keyword id="34553" type="ORGANIZATION" weightage="20" keywordseo="renewable-energy">renewable energy</keyword> producers from licensing requirements in order to encourage thermal power generators to diversify their operations. Finally, payments security protocols are being devised for agreements between producers and distributors to prevent non-payment of dues. The reforms will be a much-needed step. In order to prevent any future pile-up in bad loans, the government needs to improve the supporting <keyword id="17408" type="DOMAIN" weightage="20" keywordseo="infrastructure">infrastructure</keyword> and legislation for the power sector so that projects are capable of generating revenue.

Indian government is planning a package of reforms for the power sector

New Delhi, Apr 17 () Industry body CII on Friday said discoms are likely to suffer a net revenue loss of around Rs 30,000 crore and liquidity crunch of about Rs 50,000 crore due to the coronavirus-induced nationwide lockdown. According to government data, the discoms owe Rs 92,602 crore to Gencos as of February, 2020. In its report released on Friday, the CII has suggested host of measures like easy credit facility for discoms (from PFC and REC) to pay off its dues to Gencos, lower tariff especially for industrial and commercial consumers and deferral of indirect taxes like electricity duty, coal cess etc. According to the report, power sector, one of the essential services under the lockdown till May 3, is battling the twin issues of demand and liquidity compression. Latest data from Power System Operation Corporation Limited (POSOCO) indicates that total demand per week between March 23 and April 12 was 18 BU (billion units), compared to 23 BU during the week of March 9-15 (before Janata Curfew and lockdown), 25-28 per cent reduction in demand. The further extension of the lockdown could result in additional demand compression of 15 to 20 BU, implying a net revenue loss of Rs 25,000 to Rs 30,000 crores for the discoms, it said This will further increase the liquidity crunch to Rs 45,000 to 50,000 crores, in addition to the Rs 90,000 crore dues pending by the discoms to generating companies' pre-lockdown, it said. "Recent experience suggests that a financial restructuring package without insistence on structural reforms leads to temporary alleviation of the problem in the sector followed by eventual recurrence of the core problems of liquidity. We therefore propose that the post COVID-era is the right time to undertake an ambitious overhaul of the sector...", said Chandrajit Banerjee, Director General, CII in the report. The report highlighted that the thermal generators could face additional Rs 20,000 crore to 25,000 crore cash crunch. Renewable energy generators have been bearing the brunt of power curtailments, overdue payments by state discoms of Rs 10,000 crores and policy uncertainty, it said. Further, 20 to 25 per cent of debt of renewable energy projects comes from overseas lenders, to whom the 3-month moratorium by RBI will not apply, it pointed out. Transmission companies are facing delays in on-going projects as lockdown has affected the movement of manpower and supply resulting in delays and the manufacturing sector employing 20 lakh people across over 4000 SMEs could be at stake, it said. In such a scenario, it becomes increasingly important to inject liquidity in the sector to ensure continuous supply, power generation viability and robust industrial recovery post lockdown, it suggested. CII's white paper 'Sustaining India's Power and Renewable Energy Sector analyses impact of COVID-19 on the sector with the demand reduction coupled with delays in collections. Shot term measures include ensuring short-term liquidity management like creation of special line of credit through PFC/REC to discoms. Secondly, the government can allow deferral of payments of indirect taxes and for mitigating impact of delays in on-going renewable projects it suggested an increase in tariff. Under medium-term reforms measures, it suggested to develop a roadmap to implement cost-reflective tariffs and rationalized tariff structure with lower commercial and industrial tariffs. The central government could invest directly through a central holding company. It also asked to develop a central government-led funding scheme for accelerating the rollout of smart metering (investment of Rs 1.5 lakh crores over 4 to 5 years) and adoption of digital solutions for improving operational decision-making among discoms. It said that the liquidity crunch of discoms is likely to worsen during and post the lockdown, and the gap may grow by 20–25 percent. The sector is likely to require significant transition financing to mitigate the impact. The central power finance institutions (PFC, REC, and IREDA) should consider lending directly to discoms or to discount the discoms' outstanding dues using funds borrowed from banks or from their regular sources, it suggested. KKS DRRDRR

You Searched For "discoms" and got 11 results

Government to offer flexibility to discoms to end long term power contracts

IANS

Electrification work at world's 'largest' COVID care centre completed in record time: Discom

PTI

Cabinet likely to okay package for power discoms reeling under revenue loss in lockdown

PTI

State govt departments owe Rs 41,700 cr to discoms: Power Minister

PTI

Discoms' outstanding dues to power gencos rise nearly 32 pc to Rs 88,311 cr in Jan

PTI

Discoms' outstanding dues to power gencos rise 45 pc to Rs 81,085 cr in Nov

PTI

Regulatory assets of discoms may touch Rs 90,000 cr if economy stalls for another 4 mths: Expert

PTI

Discoms' outstanding dues to power gencos rise 48 pc to Rs 81,010 crore in October

PTI

Discoms' outstanding dues to power gencos rise nearly 50 pc to Rs 88,177 cr in Dec

PTI

Indian government is planning a package of reforms for the power sector

Dilsher Dhillon

Discoms to suffer Rs 30K cr revenue loss, face Rs 50K cr liquidity crunch due to lockdown: CII

PTI

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