Rating agency CARE Ratings has revised its outlook to negative on the borrowing programmes of 11 solar power producers due to delayed payment to them by distribution companies in Telangana for electricity purchased.

In a release on Monday, CARE Ratings said the 11 companies had a combined installed capacity of 574 MW.

It has also downgraded the ratings on borrowing programmes of two solar power generators which have installed capacity of 80 MW and sell electricity to Discoms in the State.

“The revision in outlook and ratings reflects increased counter-party risk and weakening in the liquidity position of these generators owing to significant delays in the receipt of payments from the off-takers-Telangana discoms,” it said. “Off-taker risk, stemming from delays in payments by Discoms has been a major rating weakness for solar power generators exposed to Telangana. Solar power generators in the Telangana have been facing delays in payments by up to eleven months,” CARE Ratings added.

As on June 30, 2019, total installed capacity of solar power in Telangana stood at 3,621 MW and Care Ratings has rated projects/SPVs having aggregate exposure towards Telangana discoms of approximately 900 MW.

All these entities have long- term power purchase agreements with Telangana Discoms for 25 years tenor at tariffs in the range ₹5.26 to ₹6.889 per unit.

Furthermore, there is no revision in tariffs for FY2019-20, the agency said.