NTPC to cut power supply to BSES discoms in Delhi from Sunday

NTPC to snap power supply to BSES discoms in eastern, central parts of Delhi from Sunday midnight because of non-payment of dues amounting to Rs961.58 crore


NTPC says a notice for regulation of power supply has been served on the BRPL & BYPL which will deprive Delhi of 445 MW of power with effect from 5 September 2016. Indranil Bhoumik/Mint
NTPC says a notice for regulation of power supply has been served on the BRPL & BYPL which will deprive Delhi of 445 MW of power with effect from 5 September 2016. Indranil Bhoumik/Mint

New Delhi: State-run NTPC Ltd has decided to snap power supply to BSES discoms in eastern and central parts of Delhi from Sunday midnight because of non-payment of dues amounting to Rs.961.58 crore.

“A notice for regulation of power supply has been served on the BRPL & BYPL which will deprive Delhi of 445 MW of power with effect from 00:00 hrs of 5 September 2016,” NTPC Ltd said in press statement.

“Despite clear directions of the Supreme Court, the dues continued to accumulate. Today, the outstanding amounts are Rs.961.58 crore (Rs.695.25 crore of BRPL & Rs.266.33 crore of (BYPL),” it said.

NTPC Ltd’s arm Aravali Power Company Pvt Ltd (APCPL), Jhajjar has been supplying power to Anil Ambani-led Reliance Group’s BSES Rajdhani Power Ltd (BRPL) and BSES Yamuna Power Ltd (BYPL) since 5 March 2011. The power allocated to these discoms from APCPL is 445 MW (372 MW to BRPL and 73 MW to BYPL) and average monthly energy bill is about Rs.87 crore (Rs.73 crore to BRPL & Rs.14 crore to BYPL) for the current financial year.

The company said that the payments by the BSES discoms (power distribution companies) had become irregular for quite sometime. The matter was brought before the Supreme Court, which in its judgement dated 26 March 2014 directed the BSES discoms to ensure payments of all current energy bills from 1 January 2014. However, the company said that despite clear directions of the Supreme Court, the dues continued to accumulate.

In a meeting taken by Delhi Electricity Regulatory Commission (DERC) on 16 May 2016, both BRPL & BYPL had given plan for liquidation of outstanding dues based on which regulation notice issued by APCPL earlier on 6 May 2016 was withdrawn.

The company said that APCPL has to pay in advance to its fuel suppliers which constitute about 70-80% of its monthly energy bills. “If the above situation continues, APCPL being a single power station company is unable to meet any of its commitments inter alia including payment to fuel suppliers, debt servicing requirements and even payment of salaries to its employees. under the circumstances, APCPL has no other option but to regulate power on the BSES discoms,” it added.

A spokesperson for BSES said the company was under huge financial stress due to non liquidation of regulatory assets — costs not yet allowed to be passed on to consumers — estimated to be over Rs.16,000 crore as on 31 March 2016. As compared to this, dues payable by BSES to Aravali Power Company Private Limited (APCL) are around Rs.900 crore.

The spokesperson said that payment of dues to power utilities by BSES discoms was sub judice in the Supreme Court. The judgement in the matter is reserved since February 2015.

“BSES discoms are also making concerted endeavour to address the situation and clear pending dues in a just and equitable manner. Moreover, BSES discoms have sufficient power at their disposal and the regulation will not have any impact whatsoever on the power supply situation in the city,” said the person.

(Reliance Group companies have sued HT Media Ltd, Mint’s publisher, and nine others in the Bombay high court over a 2 October 2014 front-page story that they have disputed. HT Media is contesting the case.)

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