Equity power shift may lead to hike in tariff, warn HPSEBL staff

Employees of Himachal Pradesh State Electricity Board Limited (HPSEBL) have flagged that denying equity power from SJVN’s hydro projects to the board could increase the state’s power tariff by Rs 37 paise per unit. The Joint Action Committee (JAC) of HPSEBL employees and pensioners has urged Chief Minister Sukhvinder Singh Sukhu to review the decision and continue the equity share from Nathpa Jhakri and Rampur Hydro projects to HPSEBL.

The electricity board gets 2,000 million units annually against the state’s equity share in these two projects. It translates into 15 per cent of the state’s total power demand annually, which is around 13,000 million units.

On March 6, the government wrote to HPSEBL chairman that the Council of Ministers had already decided that equity power of SJVN would be handled by Department of Energy. The letter further said the Finance Department has approved that the equity power will be traded by Himachal Pradesh Energy Management Centre in Directorate of Energy and the amount realised would come to the government. Secretary Power further wrote that the Himachal Pradesh State Electricity Board Limited should do cost cutting to ensure tariff is not affected due to it.

The Joint Action Committee, however, maintains that increase in tariff would be inevitable on account of the sudden withdrawal of equity power. “The abrupt withdrawal of substantial power will force HPSEBL to buy power from the market at higher prices. The additional power purchase from the market would raise the tariff by 37 paise per unit,” the committee wrote to the Chief Minister.

Further, the committee wrote, the increase in tariff will translate into an additional burden on state’s electricity consumers across domestic, agricultural, commercial and industrial categories. For the record, HPSEBL gets equity power from Nathpa Jhakri project at Rs 2.64 per unit and at Rs 4.93 per unit from Rampur hydro project.

JAC officials claim that the board would have to buy additional power from the market at a much higher price to bridge the shortfall. “If the government has made up its mind to reallocate the equity share to Directorate of Energy, it should give the board at least one year to arrange cheaper long-term power to fill the gap,” the JAC officials said.

The officials further claimed that the move would not yield much financial gain to the government as the increased power purchase cost will add to the state’s liability on account of free electricity schemes and relief being provided to industries in the state. The officials further warned that the sudden withdrawal of equity share may pose challenge in maintain in maintaining power security and supply stability, especially during the peak demand.