The Union Minister for Power and New & Renewable Energy has informed about the impact of the implementation of Electricity (LPS and Related Matters) Rules, 2022.
One of the key indicators of financial distress of the DISCOMs is mounting power purchase dues towards the Generation Companies (GENCOs).
With the implementation of Electricity (LPS and Related Matters) Rules, 2022, a remarkable improvement has been seen in recovery of outstanding dues. The total outstanding dues of states that were at Rs. 1,39,947 crores as on 03.06.2022, have reduced to Rs. 49,452 crores after timely payment of eighteen (18) monthly installments as on 31.01.2024.
Distribution companies are also paying their current dues in time to avoid regulation of open access under the Rule.
This Rule has not only ensured that the outstanding dues are liquidated but has also ensured that the current dues are paid in time.
It may be seen that the rule has played a vital role towards ensuring the financial discipline in DISCOMs. This would facilitate investment in the sector necessary to sustain 24×7 electricity supplies to consumers.
The Government of India has been implementing various performance linked and result oriented schemes with the objective to have a financially secure, viable and sustainable power sector (distribution segment in particular).
These initiatives have been designed to tackle financial and operational issues to bring in
desired financial discipline in DISCOMs and State Governments.
