Discoms owed ₹1 lakh Cr. to power generation companies by February: Minister of Energy

Outstanding utility company charges stood at £1 billion at the end of February this year, Parliament was informed on Tuesday.

“According to data provided by the power generation companies on the PRAAPTI portal at the end of February 2022, a total of ₹1,00,931 crores is due from the DISCOMs,” Energy Minister RK Singh said in a written response to the Rajya Sabha.

According to the Response, this overdue amount does not include the disputed amount.

The outstanding balance of the discoms (electricity distribution company) becomes overdue 45 days after the invoice for the electricity supply by gencos.

The minister explained that the government has made several interventions to improve discos’ financial and operational efficiency in the context of reform measures, including the Liquidity Infusion Scheme (LIS); additional borrowing of 0.5% of GSDP to governments related to energy sector reforms; Adoption of additional regulatory standards for Power Finance Corporation (PFC) and REC lending based on utility performance; and Revamped Distribution Sector Scheme (RDSS).

In addition, the government had also issued an order dated June 28, 2019 enforcing the opening and maintenance of an appropriate Letter of Credit (LC) as a payment security mechanism under the Power Purchase Agreement (PPA) by distribution licensees.

The order mandates NLDC (National Load Dispatch Centre) and RLDC (regional Load Dispatch Centres) to distribute electricity only after GENCO and the disco confirm the opening of LC.

These reform measures will improve the financial health of Discoms, which will improve the liquidity situation and lead to a reduction in the outstanding charges to electricity generation companies (GENCOS), Singh said.

The minister also told the House that the Central Electricity Authority forecast that coal-based thermal power generation capacity would account for around 32% of the energy mix in 2030, up from the current 52%.

In another reply, Mr Singh said that as of March 16, 2022, 36.79 million LED bulbs had been distributed, resulting in energy savings of 47,784 million units of electricity per year, a 9,566 MW reduction in peak demand and a reduction in carbon emissions. Emissions led to 38.7 million tons per year.

EESL has installed over 1.23 million (as of March 16, 2022) LED street lights in ULBs (Urban Local Bodies) and Gram Panchayats across India, resulting in energy savings of 8,516.7 million units of electricity per year and reduction peak demand of 1,419.45 MW and 5.87 million tons of CO2 emissions reduction annually, he added.

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