Tamil Nadu

Bankruptcy proceedings against KSK Mahanadi not an issue: senior official

Tangedco procures 500 MW from power company

Tamil Nadu Generation and Distribution Corporation Ltd (Tangedco) won’t be impacted much by bankruptcy proceedings initiated against KSK Mahanadi Power Company Ltd, a senior official said. The State utility procures 500 MW of long-term power from the firm’s Chhattisgarh plant.

As per the power purchase agreement, Tangedco procures power at the rate of ₹4.91 per unit and the agreement is valid up to March 31, 2029, as per the recent order by the Central Electricity Regulatory Commission.

The National Company Law Tribunal (NCLT), Hyderabad Bench, has admitted the insolvency proceedings against KSK Mahanadi, in a case filed by Power Finance Corporation. According to the petition, the amount in default is about ₹1,315.27 crore, as on June 24, 2019.

“I don't think the development will affect its normal operations. There seems to be just a change at the management level,” said a senior official. He also said the company has supplied 237 MW out of 500 MW during peak demand on Tuesday, citing coal shortage and the issue is specific to the company on account of its financial distress.

Tamil Nadu procures 3,500 MW through long-term power purchase agreement with various developers.

The official, however, pointed out that Coal India has slipped in its coal supply across the country, including to Tangedco.

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Printable version | Feb 25, 2020 12:37:40 AM | https://www.thehindu.com/news/national/tamil-nadu/bankruptcy-proceedings-against-ksk-mahanadi-not-an-issue-senior-official/article29753359.ece

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