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Power crisis pushes discoms’ outstanding dues to Rs1.21 trillion in May

As per norm, discoms get a 45-day window from gencos to clear their dues for electricity supplied by them. After this period, outstanding dues become overdue and generators charge interest on the total amount that is left to be paid.Premium
As per norm, discoms get a 45-day window from gencos to clear their dues for electricity supplied by them. After this period, outstanding dues become overdue and generators charge interest on the total amount that is left to be paid.

  • During the current spate of power crisis triggered by sudden increase in demand for power and bottlenecks in fuel supplies, several discoms have also reduced purchase of expensive power based on blended imported coal from gencos and resorted to load sheddings

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In a clear indication that the current power crisis is also the making of electricity distribution companies, the outstanding dues of discoms to power producers have risen again in May this year both sequentially and year-on-year basis. 

During the current spate of power crisis triggered by sudden increase in demand for power and bottlenecks in fuel supplies, several discoms have also reduced purchase of expensive power based on blended imported coal from gencos and resorted to load sheddings. 

The financially distressed discoms have also slowed clearing dues outstanding to gencos resulting in lower supplies. 

As per portal PRAAPTI (Payment Ratification And Analysis in Power procurement for bringing Transparency in Invoicing of generators), total outstanding dues of electricity distribution companies to power producers rose by 4.04 per cent year-on-year to 1,21,765 crore in May 2022, as against dues of 1,17,026 crore in May 2021.  Even on month-on-month basis, total dues of discoms to gencos in May 2022 increased from 1,20,954 crore in April 2022.  In May 2022, the total overdue amount, which was not cleared even after 45 days of a grace period offered by generators, stood at 1,06,902 crore as against 94,354 crore in the same month a year ago. The overdue amount stood at 1,06,071 crore in April 2022. 

As per norm, discoms get a 45-day window from gencos to clear their dues for electricity supplied by them. After this period, outstanding dues become overdue and generators charge interest on the total amount that is left to be paid.  The increase in discoms dues is also on account of a rise in power demand in the country that has pushed them to buy more power at expensive rates to meet the requirements. The maximum power demand met on Saturday stood at 199.7 GW, increasing a bit from 191 GW a few days earlier on the back of rising temperatures again in the country as predicted by the IMD. This has also increase peak shortage in the country from below 1GW to around 1.7 GW on Saturday.  In May 2020, the government had announced a 90,000-crore liquidity infusion for discoms whereby they got loans at economical rate from Power Finance Corporation (PFC) and REC Ltd. to clear their dues to gencos. This liquidity infusion package was increased to 1.2 lakh crore and further to 1.35 lakh crore. 

According to the portal, discoms in Rajasthan, Uttar Pradesh, Jammu and Kashmir, Telangana, Andhra Pradesh, Karnataka, Madhya Pradesh, Maharashtra, Jharkhand and Tamil Nadu are the biggest culprits in terms of delaying payments to gencos.  Overdues of independent power producers amounted to 55.86 per cent of the total overdue of 1,06,902 crore of discoms. The proportion of central PSU gencos in the overdue was 22.35 per cent. 

Among the central public sector gencos, NTPC alone has an overdue amount of 5,072.82 crore, followed by NPCIL - Kundankulam Nuclear Power Plant at 3,419.78 crore and DVC at 3,398.57 crore in May 2022.  Among private generators, discoms owe the highest overdue amount of 25,284.67 crore to Adani Power, followed by KSK Mahanadi Power Company Ltd at 5,324.32 crore and Bajaj Group-owned Lalitpur Power Generation Company at 5,308.29 crore. The overdue of renewable energy producers stood at 20,127.16 crore in May 2022.

 

 

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