Independent power producers (IPPs) have been asked by Tamil Nadu’s state electricity board Tangedco to offer tariff rebates for past supplies if they want their past dues to be settled under the Centre’s liquidity infusion scheme. Over-dues — dues pending for over 60 days — payable by Tangedco to power generators stood at Rs 20,268 crore on October end, and over 50% are owed to private power generating companies.
IL&FS Group’s ITPCL power plant has the highest due of Rs 2,498.3 crore from the state, followed by Jindal Steel and Power (Rs 1,481 crore), DB Power (Rs 1,105 crore), Vedanta’s Balco unit (Rs 724 crore) and GMR Energy (Rs 469 crore).
Apart from the aforementioned companies, units of Tata Power and CESC also supply electricity to the state. Tamil Nadu is seeking the discount despite power generators agreed to reduce the rate of late payment surcharge from the existing 18% to 12%.
“IPPs are being asked to provide 50% discount on late payment surcharge dues and 20% discount on pending fixed charge amounts,” an industry source told FE. Pointing the discrepancy to Union power minister RK Singh, the Association of Power Producers (APP) have written in a letter that “Tangedco is pressurising individual IPPs and trying to arm twist them into accepting huge discounts on the pending dues”.
Tamil Nadu has received Rs 30,000 crore under the Centre’s Rs 1,20,000-crore liquidity infusion scheme to clear the outstanding dues owed to IPPs. According to the design of the scheme, the funds from PFC-REC are scheduled to be disbursed to the state in two equal tranches and similarly, the dues to IPPs are to be cleared in two equal instalments. “You are also requested to direct PFC and REC to insist on non-discriminatory access to the liquidity window funds and not release funds in parts as it would put more pressure on the IPPs who are refusing to succumb to the unreasonable demands of Tangedco,” the APP letter added.
In spite of the Union power ministry circular clarifying on July 30 that “the payments (to gencos) against the sanctioned loan amounts may be made to them in proportion of their dues”, APP said that Tangedco has recommended payment of dues under the liquidity infusion scheme only to central generating stations and a few renewable energy generators. The Uttar Pradesh Power Corporation had resorted to similar tactics of seeking rebates to clear dues to gencos in August, and the Union power ministry had strongly objected to the approach, calling it “unfair” and “discriminatory”.