Retiring old thermal power is first hurdle in reducing discom debt of over ₹4.78-lakh crore: Study

Highlighting concerns of mounting debt of power distribution companies in the country, the IEEFA has suggested that a way forward could be to retire old thermal power plants, besides other measures.

The Institute for Energy Economics and Financial Analysis (IEEFA) in its report ‘Curious Case of India’s Discoms: How Renewable Energy Could Reduce Their Financial Distress’, highlights issues and suggests the way forward.

The report by IEEFA has made recommendations to reduce the financial and operational inefficiencies across India’s power distribution sector, which as of May 2020 had accumulated overdue payment liabilities of ₹116,340 crore to generation companies, while already carrying a total outstanding debt of ₹4.78-lakh crore in FY2018-/19.

Vibhuti Garg and Kashish Shah from the IEEFA, in the report recommend, among other strategies, that discoms work with state governments to retire their old, inefficient and expensive thermal power plants as a key pathway to reducing their average cost of power procurement.

the hindu businessline
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