J&K among 3 states remain barred from power trading over non-payment of dues
Jammu and Kashmir may be experiencing power outages in coming days after being barred from buying and selling on power exchange platforms till it clears its dues to power plants.
Jammu and Kashmir owes Rs 552 crore to the power generators.
However on Saturday the power ministry allowed three states – Tamil Nadu, Madhya Pradesh and Rajasthan – to sell and buy electricity at the spot market after they cleared their dues to the power generators.
Earlier On Friday, POSOCO had removed seven states from the banned list after they cleared their dues.
Now only three states – Karnataka, Jammu and Kashmir, and Mizoram — are now barred from trading in the spot electricity market. These three states together have an outstanding of R801 crore.
Power System Operation Corporation (POSOCO), a national grid operator invoking the Electricity (Late Payment Surcharge and Related Matters) Rules, 2022 barred 27 discoms from 12 states and one UT from trading in power exchanges in India on account of non-payment on August 18.
These states included Andhra Pradesh, Tamil Nadu, Telangana, Manipur, Mizoram, Karnataka, Bihar, Rajasthan, Jharkhand, Jammu and Kashmir, Madhya Pradesh, Maharashtra, and Chhattisgarh. Together they owe Rs. 5085 crore to the power generators. Among the states, Telangana owes the maximum Rs. 1,380 crore, followed by Tamil Nadu 926 crore, Rajasthan 501 crore, Jammu Kashmir 435 crore and Andhra Pradesh 412 crore.
On Friday, POSOCO had removed seven states from the banned list.
This is the first time when the ministry has invoked the rule to penalise default discoms by not letting them trade in the three power exchanges — Indian Energy Exchange (IEX), Power Exchange India Limited (PXIL) and Hindustan Power Exchange (HPX). The Electricity Rules 2022, notified this year in June, mandatesdiscoms to pay payment surcharge (LPS) on the outstanding amount after the due date of payment.
The rate of late payment surcharge for the successive months of default will increase by 0.5 per cent for every month of delay, provided that the late payment surcharge will not be more than 3% higher than the base rate at any time.
In May this year, the power ministry notified a scheme that will enable the discoms to pay their dues in 48 installments. If there is delay in paying an installment, there will be a surcharge. However, in June, it added provisions that empowered POSOCO or the National Load Despatch Centre (NLDC) to penalise defaulting discoms.
The Electricity (Amendments) Bill, 2022, also has empowered the NLDC and its regional and state-level arms to regulate electricity supply to defaulting discoms.
