Icra pegs Rs 85,000 crore subsidy dependence for discoms in current fiscal


Icra pegs Rs 85,000 crore subsidy dependence for discoms in current fiscal

Rating agency Icra has estimated a subsidy dependence of Rs 85,000 crore amid low tariff hikes allowed for discoms in 2018-19, and expects improvement in thermal plants capacity utilisation or PLF in near to medium term.

“The domestic electricity demand growth is likely to remain at about 5 to 6 percent in near to medium term, supported by thrust towards rural electrification, expected recovery in industrial/ commercial segment along with some improvement in the paying capacity of the state-owned distribution utilities,” Girishkumar Kadam, Sector Head & Vice President, Icra Ratings, said in a statement.

However, Kadam said the augmentation of domestic coal supply to meet such increase in demand for the IPPs/ Gencos remains crucial, and as a result, any delay in ramping up of coal supplies from domestic sources will lead to increase in the dependence on coal imports as seen during FY2018. Read More

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