Rajasthan may face blackout from Sunday as NTPC threatens to snap supply for defaulting on Rs 367 crore pay

Natgrp: Why are we not surprised that centralized power is not a true solution.

In a regulatory notice to the three distribution companies NTPC has said it would either curb the supply of 1258-MW or regulate it.


A senior NTPC official said three distribution companies – Ajmer Vidyut Vitran Nigam, Jaipur Vidyut Vitran Nigam and Jodhpur Vidyut Vitran Nigam – owe about 95 crore to the power generating company in addition to a recent bill raised for 272 crore. The Rajasthan companies also did not renew 187.95 crore security with NTPC after December 31, 2012.

In a regulatory notice to the three distribution companies NTPC has said it would either curb the supply of 1258-MW or regulate it from the midnight of January 13, 2013.

“The allocation letters issued by government of India says in case of default in payment, NTPC has the right to shut off or restrict power supply from power stations,” the notice said.

Weak financial health of state-owned power distribution companies including Rajasthan is a concern as the firms are unable to pay their electricity bills and meet debt obligations towards banks.

The Centre has launched a bailout scheme for the distribution companies that have accumulated losses worth 1.9 lakh crore. Losses of the six states of Punjab, Haryana, Rajasthan, Uttar Pradesh, Andhra Pradesh and Tamil Nadu are pegged at 1.2 lakh crore.

Under the restructuring package, the state governments are required to take over half of the short-term debt of their distribution companies, which will issue long-term bonds backed by the state government’s guarantee to the lenders. The states are supposed to buy the bonds over a period of two-to-five years and service the interest payment till the takeover.

The scheme envisages giving distribution companies a moratorium of three years for repaying principal of the balance 50% of the short-term loans.

Source: Economic Times

About Ritesh Pothan

Ritesh Pothan, is an accomplished speaker and visionary in the Solar Energy space in India. Ritesh is from an Engineering Background with a Master’s Degree in Technology and had spent more than a decade as the Infrastructure Head for a public limited company with the last 9 years dedicated to Solar and Renewable Energy. He also runs the 2 largest India focused renewable energy groups on LinkedIn - Solar - India and Renewables - India
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