Center for providing quick short term loans to nightclubs; movement to help companies erase Rs 1 lakh crore dues | Photo credit: BCCL
New Delhi: The government is actively considering offering quick short-term loans to electricity distribution companies (discoms) as their accumulated electricity bills payable to production houses approach Rs 1 lakh crore.
Quoting an anonymous senior government official, HEY reported that the state-controlled Rural Electrification Corp (REC) is considering offering short-term bill payment loans to private and public power utilities.
“The loans will allow distribution companies to pay their contributions to power plants and transport costs on time,” the financial daily said, quoting the official. He stressed that the credits will be within the working capital limits under other central schemes, including Ujwal Discom Assurance Yojana (Uday) and will also be granted on the basis of state government guarantees.
Recently, power utilities from states like Andhra Pradesh requested financial assistance from the Center as high spot electricity prices soared due to a crisis caused by the coal shortage. in power plants. It is important to note that the relentless rains in some of the main coal regions of the country have played a spoiling role in extending the shortage of coal stocks at power stations.
Last year, the Center announced a mega cash injection of Rs 90,000 crore into fund-strapped discoms as part of a stimulus package to revive the economy of the Covid-plagued country.
Average spot prices on the Indian Energy Exchange day-ahead market on Wednesday jumped to Rs 6 per unit due to strong demand from many states including Andhra Pradesh, Gujarat, Tamil Nadu and Maharashtra. . At the end of last week, the rains had lowered prices to Rs 4 per unit.
The publication mentioned that data from the Department of Energy’s Praapti portal showed that the contributions accumulated at the beginning of October were around Rs 93,500 crore and were likely to hit Rs 99,000 crore by then. the end of the month.
Ashok Khurana, general manager of the Association of Electricity Producers, told the daily: âIt is understood that the Ministry of Energy is considering setting up a program which will alleviate the liquidity situation of the discos and help them to pay their electricity bills.