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The National Solar Energy Federation of India (NSEFI) has appealed to Minister of Power and New & Renewable Energy RK Singh to intervene to get private solar developers that have commissioned projects in Karnataka their payments.
The projects, under National Solar Mission Phase-II Batch-III Tranche-V and with power purchase agreements (PPAs) signed with Solar Energy Corporation of India (SECI), have been commissioned and are feeding power to the grid. But the power producers have not been receiving payments due to the delay in assigning scheduled commissioning date for these projects.
According to industry sources, the projects of major players such as Hero Future, Adani Group, ACME, and Actis, with a cumulative capacity of 970 MW, are stuck. This means around 6,000-crore loans could become non-performing if the matter is not resolved.
In the letter dated May 23 (BusinessLine has the copy of the letter), NSEFI notes that commissioning of the projects scheduled for September 2017, was delayed due to various approvals not coming in. The developers then approached SECI seeking extension of the financial closure timeline and the project commissioning time frame.
The meeting convened by the Empowered Committee on September 18, 2017, resulted in SECI adopting a methodology to calculate the liquidated damage and time extension for the financial closure and project commissioning. However, even after that the Commercial Operational Date (COD) for these projects is pending and the developers are unable to receive payments despite feeding energy to the grid.
At the same time, SECI is unable to give provisional COD of plants even after visiting the projects and signing the commissioning minutes of meetings, developers say.
“Realisation of payments against the sale of energy has become extremely critical as they (solar power developers) are unable to service the debt obligations which may lead to default of provisions of loan agreement executed with project lenders,” the NSEFI letter said.
“The lenders are also asking us to provide clarity on the extension of scheduled commissioning dates of the project. In the absence of extension of timelines from SECI/MNRE and given the new RBI regulations, banks don't have any room to not recognise NPA,” it adds.
NSEFI has asked not to link payments with submission of land compliance documents as the plants are already commissioned, as allowed by the Committee in September, 2017. It has also requested granting of “provisional COD” to the affected projects so that developers can receive payment against the energy sold.
The Association requested the Minister to intervene in the matter so as to avoid developers' loans turning into NPAs. However, according to sources close to the association, no communication has been received from the ministry, yet.
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