Public non-bank financial corporations (NBFC) Power Finance Corporation (PFC) and REC should explore cheaper options for raising funds, including offshore sources.

In stating this, Energy Minister RK Singh said, the two NBFCs should focus on ensuring that the power sector value chain has access to cheaper funds, especially renewables.

“RK Singh, Union Minister of Energy and New and Renewable Energies, reviewed the performance of REC and PFC on October 4 and 5, 2021, respectively, in the presence of Minister of State for Energy Krishan Pal , Secretary of Energy, and senior officials of the Ministry of Energy, with the CMDs (chairman and managing directors) of REC and PFC, ”the energy ministry said in a statement.

The minister underlined the government’s vision to make electricity available at an affordable price for all 24 hours a day, according to the press release.

In this context, he underlined the need to improve the competitiveness of the two institutions to increase their market share.

He also advised that the two organizations should be nimble and dynamically adapt to changing market needs, increasing renewables, and making efforts to reduce the cost of their funds.

In this context, he advised PFC and REC to explore better and cheaper options for raising funds, including from offshore sources, with an overall objective of ensuring that the power sector value chain has access to cheaper funds, he said.

For this, he asked PFC and REC to conduct a strategic analysis to adapt to the changing business environment in the sector with an overall objective of providing electricity to consumers at a reasonable cost, a- he declared.

The Minister also underlined the need for a rapid resolution of stressed workers. He also suggested a series of measures to the two entities in this context, including ensuring that stressed assets are resolved at fair value with a minimum haircut for PFC and REC and in accordance with national interests.

He called on both PFC and REC to increase their reach by establishing a physical presence across the country.

The minister also ordered that oversight of projects funded by PFC and REC be stepped up, the ministry said.

He also highlighted the strengthening of the risk management framework of the two institutions. In addition, Singh also expressed concern about the finances of some power distribution companies.

He also suggested corrective measures to PFC and REC, including establishing the presence of their designated lenders on the board of directors of the relevant discoms, he said.

(To receive our electronic paper daily on WhatsApp, please click here. We allow sharing of the PDF document on WhatsApp and other social media platforms.)

Posted on: Wednesday 06 October 2021, 19:52 IST