AP Faces Financial Burden as TS Power Dues are Yet To Be Cleared

VIJAYAWADA: The Andhra Pradesh government has been facing the financial burden of paying interest at the rate of nearly 11 per cent to banks and financial institutions for the loans it took to generate power and supply to Discoms in Telangana.

The Telangana government has not been clearing the dues of over Rs 7,000 crore for a long time.

As the AP government moved the Supreme Court seeking a direction to the TS government to clear the power dues, the matter is scheduled for hearing on February 12. AP expects that the long-pending issue may be resolved and that it would get the power-related money from the TS government.

The issue dates back to June 2, 2014, when APGenco started to generate power by availing loans from banks and financial institutions, as was the normal practice, and to supply to Discoms in Telangana. This continued up to June 10, 2017.

Though Telangana Discoms were supposed to pay for the power being supplied by APGenco on a monthly basis, it failed to do so and used to pay less than what it ought to pay. This resulted in accumulation of power dues from TS to the extent of nearly Rs 3.441 crore of principal amount and late fee surcharge. Both put together, TS owes over Rs 7,000 crore by March 31, 2023.

As nearly Rs 43 crore in interest is getting added every month on the principal amount, TS dues will go up further by the time the issue gets resolved.

The Telangana government moved the High Court there, claiming that the Centre had no authority to direct it to settle power dues with AP, and the court upheld it. The AP government then moved the Supreme Court seeking its intervention and issue of a direction to the TS government to clear its power dues to AP.

APGenco claims that the issue of clearing TS power dues to AP has become complicated with provisions incorporated in the AP Reorganisation Act, 2014, remaining silent about such issues cropping up between corporations from the two states. The provisions mentioned about issues between the two states only.

The TS High Court also relied on the same issue and issued an order by saying that the Centre was not supposed to direct TS when the issue was related to two corporations like APGenco and TS Discoms in two states and not the issue pertaining to AP and TS.

Meanwhile, the APGenco is eagerly awaiting the hearing in the apex court with an expectation that it would come in their favour, given the fact that their financial burden is going up, and it is becoming increasingly difficult to clear even interest on loans raised by it. This, as the TS remains adamant by not clearing the power dues for so long.