Telangana govt to revamp ₹ 2,974 cr discom debt
January 4, 2017Finance
The Telangana Government is set to take over 75 per cent of the discoms debt of ₹8,923 crore out of ₹ 11,897 crore (as on September 2015) and the balance loan amount of ₹2,974 crore will be restructured by the discoms by issuing bonds with Government guarantee.
With the State and the Distribution companies entering into a MoU to implement the UDAY (Ujwal Discom Assurance Yojana) Scheme with the Centre at New Delhi today, and the State taking over the loan, the two State Discoms will have a interest burden relief of ₹ 890 crore per annum and they will be able to raise funds with competitive rates from the financial institutions towards capital expenditures.
Telangana is likely to benefit by up to ₹ 6,116 crore under the UDAY initiative of the Centre.
The Telangana Government is also providing a subsidy of ₹ 4,584 crore to the discoms and the consumers.
Making a statement in the Assembly today, State Chief Minister K Chandrasekhar Rao said the State has come a long way from severe power cuts with a shortage of 2,700 MW peak demand, 4 to 8 hours load relief to the domestic and other customers and 2 day power holidays to the industries, to a situation where there is no load shedding.
The two discoms in the State are burdened with long term debt of ₹ 11,897 crore and virtually in the debt trap.
At the time of inception of the State, the installed capacity was 5,863 MW and this has now reached 10,902 MWs. Of this, the firm capacity is only 7,640 MW (excluding hydel, solar and wind).
From a situation with two days power holidays on the industrial consumers, they now get round the clock supply.
Appreciating the performance of the utilities REC and PFC have reduced the interest rates to 9.95 per cent from 12 per cent benefiting ₹ 200 crore interest per annum and overall ₹ 2,000 crore in a loan period of ten years.
With the addition of a number of power projects, the State expects the installed capacity to go up to 27,187 MW, he said.
Source: The Hindu Business Line
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