The financially squeezed distributors are often seen as the weakest link in the country’s electricity industry, causing distress that trickles through the chain, from power producers, to coal suppliers and project lenders.
A pick-up in collections and an improvement in payments to gencos hold out hope for discoms, but durable economic recovery and concrete policy steps key to meaningful revival
UP’s move asking power generators to offer discounts to recover dues is just adding insult to injury
Amid soft demand for coal, state- owned CIL will hold long-term special forward auction for power producers with flexible lifting period of up to 3 years.
State-run CIL will next week hold the first phase of special e-auction for the ongoing fiscal to provide coal to power producers.
In the near term it needs to be seen how well the coal supplies are mobilised and how these companies end up tying the power which will be generated out of these projects, says Harshvardhan Dole.
Heavy monsoon rains and landslides wreaked havoc in the hill states of Uttarakhand and Himachal Pradesh and flooded parts of Haryana on June 16 and 17, leaving close to 1,000 people dead. The disaster affected power generation at many hydel plants in Uttarakhand and Himachal Pradesh.
Under the current tapering linkage policy, 75 percent of the normative quantity is supplied to the end-use plant in the first year; 50 percent, in the second year and 25 percent in the third year. No supplies are allowed after the third year.
Power producers under 78,000 mw capacity list have requested the government to extend the supply of coal beyond the scheduled time to their plants under the tapering linkage policy.
Shares of private sector Indian power producers gain on media reports the cabinet has given preliminary approval to price coal by averaging prices of domestic and imported coal.
Power Minister Jyotiraditya Scindia is discussing within the Ministry the recent proposals submitted by the private power producers to address fuel supply issues as well as to revive the crisis-hit sector.
Even though the availability of fuel continues to pose challenges for power producers, rating agency Fitch says the outlook for the industry is stable mainly on the back of some progress on the fuel availability issues and the possibility of debt restructuring of seven state power utilities (SEBs).
Private power producers have said that any hike in customs duty on import of power equipment, mainly from China, would lead to increase in electricity tariffs and would be a major impediment to inclusive growth.
Coal India has sought more time for signing fuel supply agreements with power companies, say CNBC-TV18 sources. CIL Board met on April 16 to discuss issues related to FSAs. However, minutes of the meeting are yet to be approved.
Coal India rose as much as 3%, after its board agreed for the state-run company to sign a new fuel supply agreement with power producers that contained an average penalty of just 0.01% for shortfalls in supplies.
Coal India's S Narsing Rao today said that every effort is being made by them to ramp up production so as to meet the coal needs of corporate India.
Shares in private power producers rose more than 2% in a subdued market on Wednesday on media reports the government has issued a directive to state-backed Coal India to sign deals committing to meet 80% of the coal requirement of the utilities.
Ashok Kumar Khurana from the Association of Power Producers tells CNBC-TV18 that the government should aim to keep power costs low so that it is affordable for everyone.
Vinayak Chatterjee, chairman, Feedback Ventures hopes the FY13 Budget for infrastructure has incentives and tax breaks for this laggard to start performing again.