Rs 90,000 cr package: PFC, REC sanction loans to discoms worth Rs 68,000 cr in 1st tranche

• Uttar Pradesh (UP) has claimed the largest chunk of funds under the Rs 90,000 crore package and has placed a request for a loan of Rs 20,000 crore

• The Rs 90,000-crore relief package is to be released in two tranches by state-run PFC and REC

New Delhi: Power Finance Corporation (PFC) and Rural Electrification Corporation (REC) Limited have so far sanctioned loans worth Rs 68,000 crore to discoms under the Rs 90,000-crore package announced by the Centre in May, a source told PSU Watch on Tuesday. The Centre had announced the Rs 90,000 crore package as part of Aatmanirbhar Bharat initiative in order to alleviate the stress in the power sector in the aftermath of the COVID-19 pandemic and revive cash flow. 

The Rs 90,000-crore relief package is to be released in two tranches by state-run PFC and REC and both the PSUs are to co-fund the loans in equal proportion.

Rs 90,000 crore package: First tranche of loans released

According to another source, Uttar Pradesh (UP) has claimed the largest chunk of funds under the Rs 90,000 crore package and has placed a request for a loan of Rs 20,000 crore. The person said that the first tranche of payment has already been released to Telangana, Andhra Pradesh and UP. While Telangana has sought Rs 12,000 crore under the intiative, Andhra has sought Rs 6,000 crore.

Also read: Here's the set of riders discoms will have to fulfil to avail Rs 90,000-crore package

Pre-disbursement conditions to be met for receiving first tranche

Discoms were required to enable digital payments of electricity bills, self-assessment by consumers by making provision for the consumer to send meter reading by taking a picture of the meter or SMS to facilitate provisional billing for receiving the first tranche of payment. They also had to install smart prepaid or prepaid meters in government departments, attached offices so that in future the electricity dues of discoms are paid regularly.

The backdrop

At the time Power Minister RK Singh had announced the package, the minister had said that the discoms had total outstanding dues of Rs 94,000 crore towards gencos. However, the latest data from the PRAAPTI portal showed that the total outstanding dues owed by discoms have reached Rs 1.20 lakh crore by June-end. The data for July is yet to be released by the Ministry of Power.

(PSU Watch– India's Business News centre that places the spotlight on PSUs, Bureaucracy, Defence and Public Policy is now on Telegram. Join PSU Watch Channel in your Telegram and stay updated.)