The Supreme Court on Monday rejected pleas of Delhi’s power distribution companies —BSES Yamuna Power (BYPL) and BSES Rajdhani Power (BRPL) — to vacate the stay on implementation of the sectoral tribunal’s direction to the state regulator to increase electricity tariff. The discoms have argued that if the tariff is increased, their cash flows will improve, enabling them to repay dues to NTPC.
As per an earlier SC order, the two companies were required to pay the state-run power generator Rs 788 crore by May 31. (NTPC has since sent fresh bills to them.) Both BRPL and BYPL are facing the risk of their R10,000-crore loan proposal getting rejected by a consortium of financial institutions. The fresh loan is key to the sustainability of their business given the mounting regulatory assets (deferred revenue).
If the BSES discoms fail to pay Rs 788 crore by May 31, NTPC can snap power supplies to them.
Hinting at the possibility of power cuts in Delhi, BSES senior counsel Mukul Rohtagi told a vacation bench headed by Justice BS Chauhan that it should vacate its earlier order that stayed the implementation of the Appellate Tribunal for Electricity's direction in November last year to the Delhi Electricity Regulatory Commission (DERC) to increase the tariff. The apex court had stayed the tribunal order after DERC challenged it.
However, the bench declined relief even as Rohatgi argued his clients were in financial crunch. While issuing the notice to DERC, the apex court posted the matter for hearing on July 3, along with the regulators’ petition. The judges observed that vacation of its stay order would render the DERC’s appeal infructuous.
Aptel had ordered DERC to take immediate steps for bridging discoms' revenue gap and outline a amortisation (payment) schedule. Besides, the tribunal had also directed DERC to allow discoms to recover fuel and power purchase costs regularly and effectively so that they could avert cashflow problems and ensure uninterrupted electricity supply in the national capital.
According to the discoms, a vacation of stay on the tribunal's judgement “would help ameliorate the financial position and ability to… discharge obligation in respect of current payments” towards generation companies and help them comply with the May 6 orders of the apex court.
In their application, BYPL and BRPL complained of how the DERC had not allowed them to recover their losses from tariff. Also, the Delhi government had further caused prejudice to their case as it