Supreme Court says NTPC can cut power to Delhi distributor if not paid

NEW DELHI Tue May 6, 2014 2:39pm IST

The illuminated India Gate is pictured before Earth Hour in New Delhi March 29, 2014. REUTERS/Vijay Mathur/Files

The illuminated India Gate is pictured before Earth Hour in New Delhi March 29, 2014.

Credit: Reuters/Vijay Mathur/Files

Related Topics

Stocks

   
Coal Mining In The Punjab

Coal Mining In The Punjab

In Choa Saidan Shah miners dig coal with crude pick axes and load it onto donkeys to be transported to the surface earning a team of 4 workers around $10 to be split between them.  Slideshow 

NEW DELHI (Reuters) - The Supreme Court has told India's top power producer that it can cut supplies to an electricity distributor in New Delhi if it is not paid arrears by end-May, intensifying a dispute that could lead to blackouts in the capital.

The court on Tuesday ordered BSES - part of billionaire Anil Ambani's Reliance Infrastructure Ltd (RLIN.NS) - to pay state-run NTPC (NTPC.NS) the 7 billion rupees ($116 million) it is owed by May 31.

If BSES fails to pay by the end of May, the court said NTPC is entitled to cut the power it supplies to the distributor, overturning an earlier court order that NTPC should keep power flowing despite the outstanding bill.

BSES did not immediately respond to a request for comment. It has previously said lower tariffs and a revenue shortfall meant it could not pay.

The case in Delhi reflects a growing battle over who should bear the rising cost of power in India.

On the one side are many consumers who consider cheap or free power to be a right and want tariffs kept low.

But pressure to keep prices low makes it tough for distributors to force through tariff rises they say are necessary to keep pace with changes in the cost of power, which has risen as the country imports expensive oil and gas.

BSES, which runs two distributors in Delhi, and a third firm say they face a revenue loss, built up over years of operations, totalling more than 150 billion rupees ($2.4 billion).

($1 = 60.1800 rupees)

(Reporting by Suchitra Mohanty and Tommy Wilkes; Editing by Ron Popeski)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

REUTERS SHOWCASE

WTO Row

WTO Row

Some WTO members discussing customs deal without India - sources  Full Article 

Fed Policy

Fed Policy

Fed presses forward with bond buying, cites uptick in inflation.  Full Article 

Q2 Profit Slips

Q2 Profit Slips

Samsung sees tough second half  Full Article 

Chinese Economy

Chinese Economy

China should set lower 2015 GDP growth target of 6.5-7 percent - IMF  Full Article 

Default Imminent

Default Imminent

Argentina fails to reach debt agreement   Full Article 

Economy Reboots

Economy Reboots

U.S. economy back on track with strong second-quarter rebound  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage