Discoms face financial constraints due to payment delays from govt: ICRA
The state-owned power distribution companies are facing financial constraints despite improving their aggregate technical and commercial losses, according to an Icra report.
The agency has cited delays in realising payments from state government departments for power supply as one of the reasons for the constrain of discom finances and assigned a negative outlook for the power distribution segment.
The all-India aggregate technical and commercial (AT&C) losses for state-owned discoms declined from 23 per cent in FY2021 to 16.5 per cent in FY2022 and further to 15.8 per cent in FY2023 due to infrastructure upgrades and higher subsidy payout.
Despite this progress, losses remain particularly high at over 20 per cent for the discoms in Bihar, Jharkhand, Madhya Pradesh, Odisha and Uttar Pradesh, Icra noted.
"The performance of state-owned discoms remains constrained by inadequate tariffs relative to the cost of supply, higher-than-regulator-approved AT&C losses, and a considerable
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