The Ministry of Power has accepted requests from State governments for soft loans worth ₹20,000 crore to help pay back dues to power generation companies (gencos). These loans have been extended to help power distribution companies (discoms) clear their pendency to Central public sector undertakings and private-owned gencos.
Addressing the opening session of the Conference of Power and New and Renewable Energy Ministers of States and Union Territories, Singh said: “Loan requests worth ₹93,000 crore have been recieved from the States till now. Of these, loan requests worth ₹20,000 crore accepted.”
Till now, discom dues till March 2020 were eligible to be financed by loans from the Power Finance Corporation and REC. This facility was extended in light of the Covid-19 lockdowns being imposed and bill collection by discoms being affected.
This has been further relaxed and dues during April and May can also be financed by the States, Singh said.
Taking a firm stand against use of imported Chinese equipment in the power sector, Singh said that there should be a push for local substitution.