Andhra DISCOMs Seek ₹30 Billion Loan from PFC and REC to Clear Power Generators’ Dues

Distribution companies (DISCOMs) in Andhra Pradesh have informed the Andhra Pradesh High Court they had sought a loan of ₹30 billion (~$407.95 million) from the Power Finance Corporation (PFC) and REC to enable them to clear the dues to power generators.

They informed the High Court in an affidavit that they were taking all steps necessary to get the loan approved by the end of May 2021.

The DISCOMs said that the power dues from July 2020 to December 2020, amounting to ₹5.935 billion (~$80.71 million), would be paid as soon as the loan is released.

The High Court had directed the DISCOMs to pay the monthly bills to the generators at the rate of ₹2.44 (~$0.033)/kWh for power procured from solar power generators and ₹2.43 (~$0.033)/kWh for the power procured from wind power generators, pending the resolution of the disputes between the parties by the Andhra Pradesh Electricity Regulatory Commission (APERC).


On March 24, the High Court directed the Southern Power Distribution Company Limited (APSPDCL) and Eastern Power Distribution Company Limited (APEPDCL) to file an affidavit by March 31, 2021, with the details of dues to renewable generators and when they intend to clear them.  The order followed writ appeals filed by developers regarding dues owed by the state DISCOMs pending since December 2019.

The DISCOMs have cleared the dues up to September 2019. Further, the payments were also made from time to time for the power supplied till March 31, 2020. Subsequently, the bills were not paid due to various financial constraints and the onset of the Covid-19 pandemic.

The DISCOMs, in their submission, said that the dues for the power supplied up to December 2020 to all generators worked out to be ₹5.181 billion (~$70.45 million). The High Court heard the matter on March 24, 2021, when power generators sought a schedule for the release of the dues.

The DISCOMs contended that the delay in making the payments was neither willful nor deliberate. They reiterated that they were taking all the necessary steps to procure the funds required for making the payments. However, they successfully obtained a loan of only ₹4.5 billion (~$61.19 million) on March 30, 2021, which was paid to the wind and solar generators.

The DISCOMs also added that as far as the dues payable to the power supplied up to March 31, 2020, was concerned, the generators submitted that the bills for the energy supplied worked out to ₹3.38 billion (~$45.96 million). The same would be paid in a single clearance when the Tranche II loan under the ‘Aatmanirbhar Bharat Program’ will be approved and released.

In June 2020, the Andhra government had provided a state-backed guarantee for DISCOMs to secure a ₹66 billion (~$873.4 million) loan from PFC and REC.

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