Power supply curbs proposed on payment defaulting States

New Delhi: State electricity boards (SEBs) defaulting on payments could lose part of their entitled power allocation from Central generating units, according to a new proposal being mooted by the Central Electricity Regulatory Commission (CERC).

The commission has prepared a discussion paper titled `Remedy for default in payment of dues by power utilities' to lay down solutions in case of default by the State utilities in payment of dues of Central power sector units.

Under the proposal, the generating companies would be free to sell and schedule the curtailed capacity to any other party and avoid the future loss, CERC said in a statement.

The regulator invited stakeholders' comments on the discussion paper by May 25.

CERC said this mechanism could be available to all Central generating stations and privately owned inter-State generating units. The option would also be made available to intra-State generating companies when the intra-State ABT (availability based tariff) is implemented in the respective States.

If SEBs or utilities or distribution companies still do not clear dues after the notice, the regulator said the generating company would then have to inform the regional load dispatch centres or State load dispatch centres about the default in an affidavit advising the extent to which the schedule for the defaulting party should be restricted.