Looking at the dismal financial health of power distribution companies with outstanding dues to power Gencos rising to INR 1.36 Lakh Crore in August, Government considering Privatisation Route to help ailing Discoms
India's power distribution sector has been facing severe liquidity issues due to restricted cash flow, uncertain revenue due to closure of industrial and commercial operations, the prevailing low power demand in the sector and also because many consumers are unable to pay their electricity bills due to the coronavirus outbreak, which has led to discoms being unable to clear their outstanding dues with the power generating companies. Power producers' total dues owed by distribution firms rose over 40 per cent year-on-year to INR 1.36 lakh crore in August 2020, reflecting stress in the sector. In September, the Ministry of Power came out with a draft Standard Bidding Document (SBD) for privatisation of distribution licensees. It provides guidelines for states who want to offer their electricity distribution utilities to private players to improve operational efficiency and finances. Apart from taking privatisation route government has also taken up initiative to provide financial help by announcing INR 1.2 Lakh crore liquidity infusion package, which would help discoms to pay their dues to power generating companies. Discoms in Rajasthan, Maharashtra, Uttar Pradesh, Jammu & Kashmir, Telangana, Andhra Pradesh, Karnataka and Tamil Nadu account for the major portion of dues to power gencos.
India's power distribution sector has been facing severe liquidity issues due to restricted cash flow, uncertain revenue due to closure of industrial and commercial operations, the prevailing low power demand in the sector and also because many consumers are unable to pay their electricity bills due to the coronavirus outbreak, which has led to discoms being unable to clear their outstanding dues with the power generating companies. Power producers' total dues owed by distribution firms rose over 40 per cent year-on-year to INR 1.36 lakh crore in August 2020, reflecting stress in the sector. In September, the Ministry of Power came out with a draft Standard Bidding Document (SBD) for privatisation of distribution licensees. It provides guidelines for states who want to offer their electricity distribution utilities to private players to improve operational efficiency and finances. Apart from taking privatisation route government has also taken up initiative to provide financial help by announcing INR 1.2 Lakh crore liquidity infusion package, which would help discoms to pay their dues to power generating companies. Discoms in Rajasthan, Maharashtra, Uttar Pradesh, Jammu & Kashmir, Telangana, Andhra Pradesh, Karnataka and Tamil Nadu account for the major portion of dues to power gencos.
Table of Contents
- This Quarter
- Key Features
- Leading Edge
- Numbers to Learn
- The Eighty - 20 of Industry - What Matters?
- Key Signposts
- Deployment Trends
- Technology
- Price Trends
- Industry Activities & Corporate Strategies
Companies Mentioned (Partial List)
A selection of companies mentioned in this report includes, but is not limited to:
- Tata Power Delhi Distribution Limited
- BSES Rajdhani
- BSES Yamuna
- Torent Power
- Andhra Pradesh Southern Power Distribution Company
- Andhra Pradesh Eastern Power Distribution Compnay
- Paschim Gujarat Vij Company Limited
- Uttar Gujarat Vij Company Limited
- Madhya Gujarat Vij Company Limited
- Dakshin Gujarat Vij Company Limited
- Madhya Pradesh Madhya Kshetra Vidyut Viatarn Company Limited
- Jaipur Vidyut Vitaran Nigam Limited
- Dakshinanchal Vdyut Vitaran Nigam Limited
- Kanpur Electricity Supply Company Limited
- All Other State & Private Distribution Utilities & Franchises
