‘Must Run’ status granted to renewable energy projects stand as India rejected power distributors’ demand to not buy electricity from renewable energy producers citing ‘force majeure’, or unforeseen conditions preventing from honoring contracts, after the nation went into the world’s biggest lockdown to contain the spread of the coronavirus pandemic.
The Ministry of New and Renewable Energy (MNRE) has clearly stated in a recent memorandum that “Renewable energy generating stations have been granted ‘must run’ status and this status of ‘must run’ remains unchanged during the period of lockdown.”
The discoms of Uttar Pradesh, Punjab and Andhra Pradesh have cited that demand for power has crashed as all economic activity barring essential services has come to a halt during the three-week standstill to prevent the spread of the coronavirus as a result they are invoking “force majeure.”
While the Solar Energy Corporation of India (SECI) has rejected it, the MNRE’s memorandum said discoms should pay renewable energy generators on a regular basis as was done prior to the lockdown.
However, To help discoms already battling losses, the government eased prepayment or letter of credit requirement from the full cost of power to 50 percent for electricity purchased between March 24 and June 30.
The Ministry of Power, in a seperate letter said that it’s making efforts to infuse liquidity in the power sector, the details of which will be shared with the discoms shortly.
Reference- BloombergQuint, Mercom India, Economic Times
