NTPC to suspend power supply to BSES

Power producer NTPC has announced that it will suspend supply to power distribution company BSES starting midnight of February 13 for non-payment of dues. 

The move will severely impact supply of power in East, West and South Delhi. The NTPC had given BSES until February 10 to pay its dues, failing which power supply would be suspended.

The NTPC has alleged that BYPL failed to replenish the Letter of Credit (LC) for the amount of Rs.155.19 crore and that as per power purchase agreement in the event of non-availability or shortfall in LC, the NTPC has the right to regulate and sell BYPL’s allocation of power to other parties, sources in the Power Department told The Hindu. 

The BYPL gets about 434 MW of power from the NTPC. The BRPL, which gets about 127 MW of power from the NTPC, too has failed to replenish the LC for the amount of Rs.271.61 crore and has been issued the notice.

This is not the first time that the NTPC has threatened to suspend supply to Delhi discoms for non-payment of dues. A similar notice was issued in December 2011. For their part, the discoms said they have apprised the government of the situation and are making arrangements to meet the demand.

“In the absence of a cost reflective tariff over the past several years, the discoms are under financial stress with accumulated recoverable revenue gap of around Rs.20,000 crore. In addition, the NTPC allows Delhi discoms only a 30-day credit period bringing extra pressure on our working capital. Incidentally, other States are allowed a 60-day credit period by the same generator. We are in discussions with the Delhi Government, the DERC [Delhi Electricity Regulatory Commission] and the NTPC and are confident of getting the matter resolved. BSES will ensure uninterrupted power supply for its consumers in Delhi,” said a seniorBSES official.

with thanks : The Hindu : LINK