Andhra Pradesh News: We are in financial crisis, Andhra Pradesh power discoms tell High Court

Electricity distribution companies in Andhra Pradesh have informed the High Court that they are unable to pay monthly power station bills including unpaid dues to renewable energy generators due to a “serious financial crisis”. Utilities have not paid their electricity bills since January 1 this year.

Distribution companies have asked the Andhra Pradesh High Court for a year to comply with a March 15 order that ordered them to refund dues to renewable energy producers within six weeks.

The precarious financial health of electricity distribution companies is a major factor in the current electricity and coal crisis, as generation companies are not paid and are unable to maintain coal inventories or supply. to honor debts.

The Andhra Pradesh Power Utilities told the High Court that they had made efforts to secure loan facilities from various institutions to settle the payments due but their attempts were unsuccessful.

In 2021, Andhra Pradesh declared free electricity for agriculture for the next 30 years. Free or subsidized electricity is a key poll promise made by many states like Punjab, Tamil Nadu and Telengana that do not pay generation companies.

Accumulated debt of discoms stood at ₹5.2 lakh crore while unpaid dues to power generation companies exceeded Rs 1 lakh crore.

Andhra Pradesh discoms told the High Court that there was an unpaid liability of around ₹13,011 crore towards power purchase bills to all suppliers, while discoms suffered a loss of ₹28,599 crore. They have passive loans of ₹38,836 crore in addition to interest on borrowings from financial institutions.

Receivables, on the other hand, included Rs 9,115 crore from government service dues and Rs 3,087 crore from government grants.

“The distribution companies are in a precarious financial situation for reasons beyond their control and offer an unconditional apology for not having complied with the orders of this honorable court and undertake to pay within 12 months from 27.04.2022 Said default is neither willful nor deliberate,” said the discoms plea submitted to the court.

Sources said the plea has yet to be entered in the High Court.

The High Court’s March 15 order was to settle a crucial two-year-old case that has been in the news in the country and in the international investment community. Andhra Pradesh’s attempt to renegotiate power purchase agreements (PPAs), first in India, was followed by other states like Gujarat and Punjab.

The government of Andhra Pradesh had on July 1, 2019, issued an order directing a high-level committee to renegotiate 41 PPAs with renewable energy companies and submit a report within 45 days.


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