Keep off vote bank interests from discoms | IPPAI
Improving the financial state and efficiency of distribution companies´ (Discoms) operations, allowing for renegotiation of Power Purchase Agreements (PPAs), delinking of coal from PPAs, and reducing risk for banks and ensuring implementation of open access, formed part of the top five broad suggestions made by Independent Power Producers Association of India (IPPAI) in its pre-Union Budget 20017-18 memorandum submitted to the Finance Ministry.
Light at the end of tunnel
The Power Sector has the lion´s share of 20 per cent in the industrial debt of Rs.26 trillion (lakh crore) in the country as of August 2016, followed by metals and metal products (16 per cent), roads (7 per cent) and textiles (7 per cent), and these four sectors account for about 50 per cent of the gross credit deployed in industries
India Progressing Towards Optimum Energy Mix
The summer of 2017 promises to be a watershed year for India. While the government burns the midnight oil to introduce GST by start of the upcoming financial year, Piyush Goyal, Minister of State (I/C) Power, Coal, New and Renewable Energy and Mines, is confident that all villages will be connected to the grid by May 2017.
Debt restructuring may not turn around discoms sustainably
Financial restructuring under UDAY will provide some immediate breathing space. To start with, the participating states will take over 75 per cent of discoms´ debt outstanding at end-September 2015 by FY17. The rest of the debt will be re-priced or issued as state-guaranteed discom bonds at coupon rates about 3 per cent less than the average existing interest rate (around 12 per cent).
Spurt in imported coal prices to negatively impact the power value chain
The 60 per cent rise in imported coal prices (Richard Bay Index) between April - October 2016 is likely to negatively impact the power sector value chain, says India Ratings and Research (Ind-Ra). Discoms, IPPs with non-escalable fuel cost, merchant IPP’s and ports relying on imported coal for the bulk of their volumes will face volume and profitability pressures.
Reverse AuctioN for Short Term Power Procurement | Impact on Sector
Distribution networks have been one of the major bottlenecks in the entire value chain of the electricity sector reforms. It is estimated that distribution companies (discoms) have accumulated losses in the range of Rs.3.8 lakh crore and outstanding debt of around Rs.4.3 lakh crore.
Assocham seeks PPA relaxation
In a bid to get coal under the supply fuel agreement, industry body Assocham has sought relaxation in norms seeking long-term PPAs with discoms.
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