No funds, govt may only give partial tariff relief to industry

Ruchika M Khanna

Tribune News Service

Chandigarh, December 12

In dire financial straits, the state government may not be able to implement subsidised power tariff of Rs 5 per unit for industrial consumers in toto. Only a part of the tariff could be subsidised, while fixed charges would have to be levied.

Even the tariff at Rs 5 per unit on variable power will come out to be Rs 6 per unit after including electricity duty (13 per cent), octroi (2 per cent) and infrastructure development fee (5 per cent). These additional levies to be will increase the tariff by Re 1 per unit. The subsidised tariff was to be implemented from November 1. The Punjab Government was supposed to have issued a notification, following which the new tariff order would come into effect. Forty two days down the line, there is no sign of the notification being issued, mainly because the government has no resources to pay either the farm power subsidy or the newly announced subsidy to industries.

Officials have told The Tribune that during meetings between the power and finance departments, the latter has expressed its reluctance to bear the annual burden of Rs 2,800 crore for power at subsidised rates to the industry. For the current fiscal, the government will have to pay Rs 800 crore (November 1, 2017 to March 31, 2018). The officials are currently deliberating that the subsidy should not be extended to the fixed charges to be levied for the amount of load sanctioned. “This will bring down the subsidy bill of the industry to Rs 1,700 per annum,” a senior officer said.

The Punjab State Electricity Regulatory Commission (PSERC) has announced a two-part tariff order for the industry. Industrial consumers will have to pay variable tariff on the units consumed and fixed charges for the sanctioned load.

A Venu Prasad, Managing Director, PSPCL, said the government was working on various models to give subsidy to industrial consumers. “We will meet industry representatives to arrive at a conclusion on how to implement the subsidised tariff. The PSERC has allowed industries to do load adjustment till December 31. Once it is done, the fixed charges will also decrease,” he said.

No notification yet

The subsidised tariff was to be implemented from November 1, but even after 42 days, there is no sign of a notification in this connection. Sources say the government has no resources to pay the power subsidy. 

Finance Dept reluctant

Top government officials said that during meetings between the power and finance departments, the latter expressed its reluctance to bear the annual burden of Rs 2,800 crore that will accrue from giving power at subsidised rates to the industry.