Six power distribution utilities invoke force majeure clause, tell private sector generators not to expect payment

The Covid-19 outbreak has left private sector power generators out in the cold. Over the last two days, at least six state-run power distribution utilities (discoms) asked private sector gencos, with whom they have entered into power purchase agreements (PPA), to shut down and not expect any payment till further notice.

The discoms of Uttar Pradesh, Punjab, Haryana, Telangana, Madhya Pradesh, and Dadra and Nagar Haveli (a union territory) have invoked the force majeure clause for an indefinite period. According to the Punjab State Power Corporation Ltd (PSPCL), the decision has been taken in view of a “drastic reduction in demand” due to the shutdown of industrial units.