MoP and MNRE issue clarification on payment of discom dues

The Ministry of Power (MoP) has clarified that discoms will continue to be obligated to pay for power within 45 days of a bill being presented. The clarification comes after misconceptions regarding the MoP’s order dated March 27, 2020 that relaxed norms for a payment security mechanism to help discoms that are battling non-payment in the nationwide lockdown. As per the ministry, the discoms will need to either deposit fund or give a letter of credit for 50 per cent of the cost of power they want scheduled, while the remaining 50 per cent will have to be paid within the period given in the power purchase agreement (PPA), failing which the late payment surcharge (LPS) will apply. The Ministry of New and Renewable Energy (MNRE) has also issued a clarification regarding the payment to renewable energy generating stations during the moratorium provided to discoms by the MoP. The MNRE has granted “must-run” status to renewable energy generating stations and this status will remain unchanged throughout the lockdown period.