Ministry of Power clarifies regarding letter of credit as payment security mechanism

Dec 18, 2019 | by Avantis RegTech Legal Research Team

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Commercial Compliance

The Ministry of Power on August 09, 2019, has clarified regarding the order related to opening and maintaining of Letter of Credit (LC) as payment security mechanism under power purchase agreements by distribution licensees.

Therefore, the Discoms are mandated to issue unconditional LC for power purchases as a payment security August 01, 2019 onwards; and LC for power purchase shall be made available for load dispatch center. 


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