Payment norms for discoms relaxed: Power companies told to ensure uninterrupted supply

To assure uninterrupted power supply in the middle of the country-wide lockdown to contain the coronavirus outbreak, the Union power ministry has relaxed payment norms for electricity distribution companies (discoms). The Central government has asked the state-run power generating companies such as NTPC and Power Grid Corporation of India Ltd (PGCIL) to not curtail supply to the states even if the discoms do not clear payments to them on time.

The lockdown in seen to take a toll on the finances of the state-run discoms which are finding it difficult to continue meter reading exercises and collect payments from consumers. To make matters worse for discoms, their revenues are seen to decrease on account of lower usage by high paying consumers such as the railways, industrial and commercial users. Though the household sector consumes more than a third of electricity supplies, it is cross-subsidised by industrial and commercial users of electricity. Tariffs on domestic consumers is on an average around 40% lower than that for industrial users of power.