Economy

Power discoms owe gencos more than ₹1.56 lakh crore: Minister

Chennai, 25/09/2020 : In a significant development, India's daily power consumption has suffered a 26 per cent and more fall since the pandemic. The fall is attributed to the slump in the economic activity in the wake of the Coronavirus. The drop has already pulled spot power prices to the lowest level in more than two years and could spell further financial troubles for the ailing discoms (distribution sector consists of Power Distribution Companies). The power demand in India, the world's third-largest energy consumer, has been falling in the wake of frequent lockdowns announced by the Indian Government in a bid to contain the spread of the Coronavirus pandemic. Photo : S. R. Raghunathan

Chennai, 25/09/2020 : In a significant development, India's daily power consumption has suffered a 26 per cent and more fall since the pandemic. The fall is attributed to the slump in the economic activity in the wake of the Coronavirus. The drop has already pulled spot power prices to the lowest level in more than two years and could spell further financial troubles for the ailing discoms (distribution sector consists of Power Distribution Companies). The power demand in India, the world's third-largest energy consumer, has been falling in the wake of frequent lockdowns announced by the Indian Government in a bid to contain the spread of the Coronavirus pandemic. Photo : S. R. Raghunathan

Total outstanding dues owed by power distribution utilities or discoms to generation firms (gencos) are estimated to be more than ₹1.56 lakh crore, Parliament was informed on Thursday.

“Discoms have not been able to pay the generation companies for the power procured, and the outstanding payments to generation companies are estimated to be in excess of ₹1,56,000 crore,” Power Minister R. K. Singh said in a written reply to the Lok Sabha.

Reforms deliberated

“The outstanding dues to renewable generators are around 11 months of revenues. Therefore, reforms have been deliberated upon in consultation with the states and all stakeholders,”

The condition of most of the State government-owned distribution companies is a matter of grave concern, the Minister stated.

Their AT&C (aggregate technical and commercial) losses at the end of 2019-20 range from an average of 21% to a maximum of 60.16%.

The gap between Average Cost of Supply (ACS) and Average Revenue Realised (ARR) excluding Regulatory Assets and Ujwal DISCOM Assurance Yojana (UDAY) grants averages 60 paise per unit in 2019-20 and the accumulated losses of all discoms in the country by 2019-20 have risen to ₹5,07,416 crore, he informed.

About government’s plans to introduce a Bill, enabling the power consumer to choose from multiple service providers, the minister said, “No final decisions have been arrived at so far.”


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Printable version | May 21, 2022 6:12:47 pm | https://www.thehindu.com/business/Economy/power-discoms-owe-gencos-more-than-156-lakh-crore-minister/article37972030.ece