36,000 MW are coal-based projects within which tariff under-recovery has impacted 20,000 mw of capacities
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New Delhi: Some 46,000 MW of power projects are facing viability issues due to lack of long-term buyers for electricity, inadequate fuel supply, and aggressive bidding to win projects and coal blocks, according to a report by rating agency Crisil on Tuesday.
Of this, 36,000 MW are coal-based projects within which tariff under-recovery has impacted 20,000 mw of capacities, while the rest are reeling because of inadequate feedstock and poor electricity offtake by discoms. And 10,000 MW of gas-based projects have become unviable because of dwindling fuel supplies from the Krishna-Godavari basin.
“Total loans to these stressed generation projects are currently about Rs 2.1 lakh crore. A sixth of it, or about Rs 35,000 crore, is for projects which have the cushion of a strong parent. Additionally, projects with loans of Rs 1 lakh crore could become viable if their payment profiles can be structured appropriately. This leaves the remaining Rs 75,000 crore of loans at risk,” said Pawan Agrawal, chief analytical officer, Crisil Ratings. Another Rs 1.9 lakh crore of debt is owed by weak discoms for which moratorium on principal repayment ends in the current and next fiscal. Till date, government support has prevented these discoms from turning weak.
“Assurance of continuing financial support is necessary else this debt, too, can be at risk,” said Crisil. It said that a significant efforts to augment domestic coal production and improvement in the ability of discoms to sign long-term PPAs are critical going forward.
“While the government has taken some positive steps to improve fuel availability, these provide only limited relief.
( Source : deccan chronicle )
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