Private power producers have urged the government to consider extending the trade receivables discounting system (TReDS) applicable for MSMEs to them to help resolve their payment woes, which are to the tune ₹41,240 crore.
In a letter to Power Secretary Ajay Kumar Bhalla, the Association of Power Producers on Friday said the delay in recovery of receivables, especially regulatory receivables, has created stress on their finances as it impacts their ability to service debt and severely restricts working capital liquidity.
According to the letter, as of end-January, the amount of receivables due from discoms is to the tune of ₹41,240 crore, of which dues from sale of power are around ₹17,246 crore, while dues stuck in litigation are worth ₹17,128 crore and nearly ₹6,865 crore of receivables are pending despite adjudication.
“We urge the Power Ministry to take expeditious action on this issue to help avoid create more NPAs and to ensure the availability of adequate power during the summer which is also the election season,” APP Director-General Ashok Khurana said in the letter.
He further said since the government has taken measures to address the receivables situation for MSMEs through the TReDS, extending the same to them will be of immense help. Moreover, the RBI has also issued guidelines for implementing the system.
“We believe a similar system would greatly ease current stress on private power producers and we request the ministry to consider implementing the same for us as well,” Khurana said.
It may be recalled that the Power Ministry had suggested a similar system to the empowered committee, which had proposed formulation of a proposal for tri-partite agreement for discounting bills of power producers.
A senior official at a private producer said if the discoms are unable to make timely payments, it will severely impact the sector in the long-run.