Inadequate tariff revision in FY20 a concern for discoms, says Icra


Inadequate tariff revision in FY20 a concern for discoms, says Icra

Inadequate revision of rates alongwith delay in filing tariff petitions are likely to remain an area of concern in the financial year 2020 for distribution companies (Discoms), says a report. Discoms have already managed to bring down its losses and debt levels significantly under the UDAY scheme.

According to the rating agency Icra, state distribution utilities in 17 of the 29 states have filed tariff petitions for FY20, reflecting less-than-satisfactory progress. “The delay in filling of tariff petitions by the Discoms is a deviation from terms of the UDAY scheme, wherein they were required to file the plans in a timely manner so that the State Electricity Regulatory Commissions (SERCs) would issue the tariffs orders by March end,” Icra said.

It further noted that tariff hikes proposed and approved for the past 2-3 years have remained lower than what was agreed under the UDAY, leading to persistent gap between average tariff and average cost of supply, though reducing from earlier years. Read More

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