Despite various schemes, Punjab government departments owe Rs 2,324 crore to PSPCL

Despite the Punjab State Power Corporation Limited (PSPCL) recovering around Rs 363 crore in December 2024 from some government departments, the PSPCL’s defaulting amount in 2025 is still high at Rs 2,324 crore. While the PSPCL has been raising loans to meet its important expenditures, four state government departments collectively owe 91.7 per cent of total defaulting amount, as per the data compiled till January 31.

The four main defaulter departments that have failed to clear the dues are water supply and sanitation (Rs 957 crore), local government (Rs 698 crore), rural development and panchayat (Rs 340 crore) and health and family welfare (Rs 107 crore). Four other defaulter departments — sewerage board (Rs 54 crore), home affairs (Rs 23 crore), public works (Rs 23 crore) and school education (Rs 21 crore) — collectively owe Rs 121 crore.

The populist free power subsidy scheme and delayed payments in lieu of that has forced the cash-strapped PSPCL to seek repeated loans to meet expenses and delay salaries and pension. Last year, the Punjab State Electricity Board Engineers’ Association (PSEBEA) — one of the largest bodies of power engineers — had also asked Punjab State Electricity Regulatory Commission (PSERC) to take suo motu notice regarding pending payments by the state government and its departments to safeguard the interest of the public at large.

Despite many extensions to the much-hyped Punjab Government's One Time Settlement (OTS) scheme, in 2023 and 2024, the defaulter departments continue to be reluctant to clear their dues.

The PSPCL had filed a petition for the introduction of the OTS scheme for all categories of consumers (except agricultural power), following which the PSERC had approved it for three months in 2023. However, due to poor response it was extended time and again. Government offices, however, again failed to turn up and deposit their pending bills.

As per the PSPCL's latest data, the pending amount for government defaulters is south zone (Rs 638 crore), followed by border zone (Rs 569 crore), west zone (Rs 551 crore), north zone (Rs 368 crore), and central zone (Rs 201 crore) for the period ending January 2025.

The defaulting amount for period ending July 2024 is Rs 757 crore, Rs 748 crore and Rs 704 crore, border zone, south zone and west zone respectively.

In December 2024, maximum recovery was done by the west zone (Rs 102 crore), followed by border zone (Rs 96 crore), north zone (Rs 68 crore), south zone (Rs 57 crore) and central zone (Rs 39 crore), respectively.

“Last year short of funds, the PSPCL had taken a loan of Rs 800 crore to meet its statutory financial requirements, mostly due to political compulsions,” said VK Gupta, spokesperson of All India Power Engineers Federation.

“We are hopeful that the government will clear our dues this fiscal, as otherwise loans will have to be taken for payment of power purchase cost, coal cost, railway freight and other unavoidable expenditures,” said a senior PSPCL official.