Discoms' Outstanding Dues To Power Producers Rise 28% In September
Power lines hang over building tops in Mumbai, India. (Photographer: Prashanth Vishwanathan/Bloomberg) 

Discoms' Outstanding Dues To Power Producers Rise 28% In September

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Power producers' total dues owed by distribution firms rose over 28% year-on-year to Rs 1,38,479 crore in September, reflecting stress in the sector.

Distribution companies owed a total of Rs 1,07,930 crore to power generation firms in September 2019, according to portal PRAAPTI (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 September 2020, the total overdue amount, which was not cleared even after 45 days of grace period offered by generators, stood at Rs 1,26,661 crore against Rs 85,790 crore in the year-ago period.

According to the latest data on the portal, total outstanding dues in September increased on a month-on-month basis as well. In August, total outstanding dues of discoms stood at Rs 1,34,928 crore. The overdue amount in September has increased from Rs 1,22,090 crore in August 2020.

Power producers give 45 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, the centre enforced a payment security mechanism from Aug. 1, 2019. Under this mechanism, discoms are required to open letters of credit for getting power supply.

The central government had also given some breathers to discoms for paying dues to power generating companies in view of Covid-19-induced lockdown. The government had also waived penal charges for late payment of dues in the directive.

In May, the government announced Rs 90,000 crore liquidity infusion for discoms under which these utilities would get loan at economical rates from Power Finance Corp. and REC Ltd. This was an initiative of the government to help gencos to remain afloat. Later the liquidity infusion package was increased to Rs 1.2 lakh crore.

Discoms in Rajasthan, Maharashtra, Uttar Pradesh, Jammu & Kashmir, Telangana, Andhra Pradesh, Karnataka, Jharkhand, Haryana and Tamil Nadu account for the major portion of dues to power generators, data showed.

Overdues of independent power producers amount 32.79% of the total overdue of Rs 1,26,661 crore of discoms in September. The proportion of central PSU generators in the overdue was 37.18%.

Among the central public sector power generators, NTPC Ltd. alone has an overdue amount of Rs 22,235.02 crore on discoms, followed by NLC India at Rs 6,770.20 crore, Damodar Valley Corp. at Rs 5,662.10 crore, NHPC Ltd. at Rs 3,579.06 crore and THDC India at Rs 2,017.66 crore.

Among private generators, discoms owe the highest overdue of Rs 20,153.16 crore to Adani Power followed by Bajaj Group-owned Lalitpur Power Generation Co. at Rs 2,957 crore, GMR at Rs 1,930.16 crore and SEMB (Sembcorp) Rs 1,697.85 crore.

The overdue of non-conventional energy producers like solar and wind stood at Rs 10,680.28 crore in September.

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