The Delhi government today decided to extend financial assistance to Reliance Infrastructure-backed discom BSES, which has defaulted on payment of around Rs 3,000 crore to various power generating and transmission firms.
The decision to offer the help to the beleaguered company was taken at a Cabinet meeting presided over by the Chief Minister, Ms Sheila Dixit.
Ms Dixit, however, did not give details about the financial assistance but officials said the government is likely to infuse fresh equity to the tune of around Rs 500 crore into the company on the condition that the discom would also infuse the same amount. The Delhi government holds 49 per cent share in BSES.
The Chief Minister had apprised the Prime Minister, Dr Manmohan Singh, the Finance Minister, Mr Pranab Mukherjee, and the Union Power Minister, Mr Sushil Kumar Shinde, about the looming crisis facing the city arising out of BSES failure to pay the dues to the transmission and generation companies.
“We have taken a decision (to help the discom) to ensure that power cut does not take place in the city. We had discussed the issue with the Centre before taking the decision,” Ms Dixit said without elaborating.
NTPC threat
The NTPC has threatened to cut supply of 2,000 MW of power to BSES if it fails to pay the dues by January 7. If NTPC stops supply of power to BSES, it may lead to a blackout in 70 per cent of the areas in Delhi.
The Delhi government will inform power regulator DERC about its decision to help the cash-strapped discom tomorrow following which the regulator will issue a formal order for resolving the crisis.
Ms Dixit indicated that government may also offer financial assistance to Tata-backed discom NDPL even though it has not sought any assistance. “We will not help only one company. We will help both the discoms,” she said.
BSES request
Last week, the BSES had requested the government to infuse fresh equity so that around Rs 1,000 crore could be generated, which could be used for getting a loan of Rs 5,000 crore from IDBI bank.
The DERC had set a deadline of tomorrow for the government to clear its stand on how a whopping Rs 3,000 crore would be arranged if licence of BSES to operate in the city was cancelled for defaulting on the payments.
BSES had approached IDBI Bank and Power Finance Corporation for a loan of Rs 5,000 crore but the company was told to arrange at least 20 per cent of the loan amount (Rs 1,000 crore) on its own to get the loan.
DERC notice
The DERC slapped notices on BSES on November 25 asking why its licenses should not be suspended for failing to clear huge dues to the generation companies and said if the Commission was not satisfied with replies by the discom, then it may suspend the license and appoint an administrator to discharge the functions of the licensees.
The discom, replying to a fresh notice earlier this week, could not satisfy the DERC on arranging the funds following which the regulator had asked Delhi government to clear its stand on the issue.