Delhi may again face summer power cuts as SC rules in favour of NTPC

The Supreme Court on Tuesday told the National Thermal Power Corp, India's top power producer, that it can cut supplies to electricity distributors in New Delhi if it is not paid arrears by the end of May, intensifying a dispute that could once more lead to blackouts in the capital after a rare period of uninterrupted power supply under the previous Shiela Dikshit government.

The court on Tuesday ordered BSES, owned by Anil Ambani's Reliance Infrastructure Ltd in partnership with state power utility, to pay NTPC the Rs700 crore it owes by 31 May, failing which NTPC is entitled to cut power supplies to the distributor.

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

Many consumers consider cheap or free power to be their right, and want tariffs kept low; this pressure makes it tough for distributors to hike tariffs, and is driving them into losses – mainly on account of the rising prices and decreasing availability of the necessary fuels – whether coal, oil or gas.

Delhi's power distribution companies, or discoms as they are called, say they face a revenue loss, built up over years of operations, totalling more than Rs15,000 crore.