News

Unable to recover costs, private discoms in Delhi seek govt help

State-owned NTPC Ltd’s threat earlier this month to cut off power supply to two units of Reliance Infrastructure Ltd supplying to large parts of Delhi due to delay in payments point to the financial distress slowly gripping private power distribution companies in the capital, which are now pinning hopes on central and state governments coming to their aid. Reliance Infrastructure arms BSES Yamuna Power Ltd (BSEL YPL) and BSES Rajdhani Power Ltd (BSES RPL) and Tata Power Delhi Distribution Ltd are together saddled with more than Rs.36,000 crore of power purchase cost yet to be recovered from consumers due to delay in power tariff revision. The companies now want not just government intervention in a debt rejig, but concerted efforts to reduce their power purchase cost, including replacement of costly long-term power purchase agreements that were signed by their predecessor Delhi Vidyut Board (DVB) before its privatization in 2002 with new ones from efficient and cost-effective power plants.

“At the end of the day, the benefit of financial and operational efficiency achieved from UDAY will go to consumers, whether power is supplied by a government entity or a private one. Consumers in Delhi should not be deprived of its benefit,” said Praveer Sinha, chief executive officer (CEO) and managing director of Tata Power Delhi Distribution.