Power Ministry urges states to direct utilities to clear dues to gencos, coal firms

The Ministry of Power has urged certain states, including Uttar Pradesh, Tamil Nadu and Maharashtra, to direct their utilities to clear total outstanding dues towards generating firms (gencos) and coal companies as failing to do so might affect electricity supply.

Union Power Secretary Alok Kumar has highlighted that lack of adherence to basic payment discipline by the utilities is not only causing supply side problems in generation of electricity, but also adversely affecting new investment in the sector. He stated that public utilities have higher responsibility to be ideal paymasters and upholders of contract laws of the country, adding that repeated indiscretion on part of the utilities goes against the very essence of these basic responsibilities.

He further stated that if the utilities continue to renounce their responsibilities for timely payments to their creditors, and do not wipe out their past and current dues on an urgent basis, this will have a perilous effect on the power supply. He added that inability of the utilities to pay for legitimate dues against electricity dispatched and the coal received is increasing the electricity supply side concerns to unprecedented levels.