Discoms can benefit from EMI scheme, there can be 25% savings in additional payment: Crisil

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New Delhi. Distribution companies (Discoms) can benefit from the new EMI scheme to clear the dues of the Ministry of Power. According to Crisil Ratings, this can help discoms save a quarter of their additional payments. In the current financial year, discoms have to pay around Rs 20,000 crore to power generation companies (Gencos).

can save a quarter of the extra payment
CRISIL said in a statement, “If the discoms accept the new plan of the Ministry of Power, they can potentially save a quarter of their additional payment and pay Gencos in the current financial year for their annual cost of power purchase.” Apart from this, can effectively pay Rs 20,000 crore.

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Under this scheme, old dues including Late Payment Surcharge (LPS) up to June 3, 2022 will be converted into Equated Monthly Installments (EMIs). The discom will have to pay this amount in 12 to 48 months.

There can be savings of Rs 6,500 crore to Rs 7,500 crore
Manish Gupta, Senior Director, CRISIL Ratings said in the statement, “With a 25 per cent savings (from Rs 6,500 crore to Rs 7,500 crore), the net payment by discoms to Gencos in the current financial year is Rs 20,000 crore over and above their annual cost of power purchase. There is a possibility of Rs. It may be a challenge to clear this dues through internal sources, as the discoms are facing operating losses.

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“At least immediate one-time additional recovery through tariff rates or government assistance to cover the incremental payments can help discoms clear their dues in the current financial year,” Gupta said.

Tags: Electricity, Ministry Of Power

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