Report Summary Unprecedented Lockdown to Fight Spread of COVID – 19 – Struggling Power Distribution Utilities to Bleed further for Finances!
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In Q2 CY 2020 the overall capacities to be added in the line length at 33 kV of India is expected to be in range ~ 1,500 to 2,000 ckm. With maximum of the capacity additions happening in July 2020 only. Further, implementation of smart metering scheme is expected to slip in Q3 of 2020 due to COVID outbreak
On March 25th, 2020, India began unprecedented 21-day lockdown to fight spread of Coronavirus. In this troubling times of ‘social distancing’ and ‘work of home’, the power distribution sector is also bound to get an adverse impact of this pandemic. The COVID-19 lockdown has led to shut down of all but essential commercial & industrial activities in the country. Around, 1.3 Billion citizens are confided to their respective homes and in most of the cases are only allowed to ‘work from home’. Consequently, the electricity demand from industrial and commercial customers has reduced significantly while the residential demand is expected to have increased. Thus, a key risk from COVID-19 pandemic for already struggling distribution utilities arises from the loss of revenues from commercial and industrial consumers which forma a major pie in the revenue generation of such utilities. Further, fixed cost components in tariffs are fairly-low. Discoms will face huge working capital issues which will be a serious challenge in coming Quarters.
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