Tangedco owes Rs 18,069cr to power generators

CHENNAI: Woes of discoms across the country have worsened as their total outstanding to power generators increased from Rs 95,501 crore to Rs 1.2 lakh crore between March and June. Rajasthan’s power utility with Rs 33,379 crore outstanding tops the list, followed by Tangedco with Rs 18,069 crore.
Senior officials in state finance department and Tangedco said the utility was awaiting the Union Cabinet’s nod for its share of Rs 20,000 crore financial assistance the Centre had announced in May.It is part of the Rs 90,000 crore financial assistance the Centre said wouldbe providedby theRural Electrification Corporation (REC) and Power Finance Corporation (PFC) to discoms as credit. The proposal for providing Rs 20,000 crore has obtained all clearances from the two financial institutions. Only the Union Cabinet’s nod is pending, said a finance department official.
Discoms across the country are currently facing a range of issues like operational inefficiency, low tariffs and lower industrial power demand which is affecting their ability to pay power suppliers on time.
In the south, Tangedco is the most-stressed power utility. The state has not revised the power tariff since 2014 despite the dicsom’s mounting debts. Tangedco owes more than Rs 6,000 crore to inter-state independent power producers (IPPs).
A few of them have written letters to Tangedco for encashing the letter of credit, if payment is not released to them andsomeof them have approached Tamil Nadu Electricity Regulatory Commission seeking interest on the payment pending from Tangedco. Recently, the TNERCasked Tangedco to pay Rs 7 crore as interest to various power generators.
“During the visit of Union power minister R K Singh to Chennai last month, he had promised the state that the Centre would not insist on direct benefit transfer (DBT) and entry of private franchisee in distribution. We sought the Centre’s help to clear the outstanding to be paid to power generation companies,” said a senior official.
But power experts have a different viewon thetwofinancialinstitutionsdelaying releaseof fundstothediscom. “While making the announcement, the Centre wanted the discoms tofulfilcertain parameterslike implementing DBT, asking government departments to clear their dues to discoms etc. Unless the discoms fulfil these parameters, it will be a problem for the financial institutions,” former Union power secretary Anil Razdan told TOI.
He also said the local regulatory authority must act independently. “The regulatory authorities must not only ask the discoms to revise the tariff but also look into the performance of the discoms,” said Razdan, adding thatthe regulators needtohavebetter control.