The total amount of outstanding debts owed by Electricity Distribution Companies (Discoms’) to power producers was reduced by almost half, from ₹ 1,21,030 crore in January 2022 to ₹ 62,681.68 crore in January of the following year.
According to experts, the significant decrease in the total outstanding debts of discoms was mainly due to the government’s implementation of late payment surcharge rules and the provision of equated monthly installments (EMIs) for utilities. These measures were taken in order to improve the financial stability of the discoms.
According to the PRAAPTI portal, which provides transparency in invoicing for power generators, the total outstanding debts of Discoms in January 2023 were at ₹ 62,681.68 crore. This included an overdue amount of ₹ 25,526.42 crore that had not been cleared by the discoms even after the 45-day grace period offered by the generators.
In January 2022, the total outstanding debts of Discoms were at ₹ 1,21,030 crore, including an overdue amount of ₹ 1,01,357 crore.
Power producers typically allow discoms a grace period of 45 days to pay their bills for electricity supply. If the discoms fail to make payment within this time frame, the outstanding debts become overdue and generators may charge a penalty interest.
The PRAAPTI portal was launched in May 2018 with the goal of increasing transparency in the power-purchase transactions between generators and discoms. The portal has undergone recent updates and renovations.
In November 2022, the power ministry reported that the implementation of the Electricity (LPS and Related Matters) Rules of 2022 had led to a significant improvement in the recovery of outstanding debts from suppliers, including generating companies, transmission companies, and traders.
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