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COVID lockdown has adversely impacted the revenues and cash collections for the power distribution utilities especially from high tariff paying industrial and commercial consumers, also there are likely delays in cash collections from other consumer segments. Also delay in issuance of tariff orders or inadequate tariffs approved by the state electricity regulatory commissions will also accumulate for losses for Discoms. Due to financial crunch, credit risk rating provided by CRISIL may also reduce, as impact on liquidity profile of Discoms is also considered. Power demand can be improved by phased lifting of lockdown where Industrial and commercial consumers starts resumption of operation.

Reduction in demand is likely to impact profit levels of Discoms, losses on Discoms are certain to increase at all India level and it will also suppress PLF of thermal plants at all India level. Government was working on resolution of stressed thermal plans, which would be further delayed due to absence of long term PPA.