Icra revises thermal power sector outlook to 'stable' on strong demand

Rating agency Icra has revised thermal power sector outlook to 'stable' from 'negative' due to strong demand growth and realisation of dues from discoms under LPS (late payment surcharge) scheme.

The Icra's outlook for the thermal power segment has been revised to stable from negative, supported by the healthy improvement in the thermal PLF (plant load factor or capacity utilisation) level in FY2023, which is likely to sustain in FY2024, coupled with the reduction in dues from state distribution utilities (discoms), an Icra statement said.

The PLF improvement is driven by the strong recovery in electricity demand growth in the country. A sustained growth in electricity demand is expected to improve the visibility on the signing of new power purchase agreements (PPAs) for the thermal IPPs (independent power producers), it stated.

Vikram V, Vice President & Sector Head - corporate ratings, Icra, said, "The all-India thermal PLF level is expected to improve from 58.9 per cent in ...