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Free power draining Punjab’s coffers, but votes matter

The Tribune’s deep dive into the power crisis in the state — Part III

Free power draining Punjab’s coffers, but votes matter

Tribune photo: Vicky



Ruchika M Khanna

& Aman Sood

Tribune News Service

Chandigarh, June 20

Politics and economics rarely go hand in hand. Power subsidy being used as a tool by Punjab’s political class to woo voters, at the cost of the state’s fiscal health, perfectly explains this adage; this ploy yields the desired results for the parties.

Industry opposed to it

It is a known fact that power meters are being tampered with in order to ensure that the consumption remains within the ambit of the scheme. No one should be given free power except small and marginal farmers. — RS Sachdeva, Chairman, PHD Chamber

After the announcement of free power to the farm sector made by a government in 1997 (the SAD-BJP alliance had won the elections riding on this promise) and its withdrawal led to the Congress losing the 2007 Vidhan Sabha elections, free power became the “lollipop” offered by political parties to woo different sections of voters. So, if the Congress initially gave 100 units of free power to SC/BC families during its tenure in 2002-07, the successive Akali BJP government doubled the limit to this category of consumers, besides extending it to freedom fighters and Below Poverty Line consumers.

When the Congress returned to power in 2017, at the fag end of his tenure in 2021, the party’s first Dalit Chief Minister Charanjit Singh Channi retained 200 units of free power to these consumers and slashed the power tariff for the domestic consumers by Rs 3 per unit, provided their load was less than 7 KW.

In the race to woo voters with freebies, the Aam Aadmi Party, in the run-up to the 2022 Vidhan Sabha elections, guaranteed 300 units of free power to all domestic consumers. And once they stormed to power in March 2022, they implemented their “welfare” scheme for domestic consumers with 90 per cent consumers getting free power. In nearly two years since the promise of 300 units of free power to domestic consumers per month has been fulfilled, the power subsidy has increased from Rs 5,739 crore in 2022-23, to Rs 7,071 crore in 2023-24, and it’s pegged at Rs 7,384 crore in 2024-25.

With the state’s near-empty coffers, AAP has stood firm on continuing with the subsidy even as the Centre has been rather critical of the move. Former Union Power Minister RK Singh had taken a jibe at the AAP government in Punjab as the free power sop had pushed the state into a ‘debt trap’. Not bothered, the party leadership maintains that this is their way of helping people, caught in between high inflation and static incomes in the post-Covid era. Party strategists are of the firm belief that this sop has helped the ruling party get a vote share of 26.02 per cent, very near to the Congress vote share of 26.30 per cent.

Interestingly, everyone is well aware of how the consumers have started to bifurcate their existing power connections in order to avail the 300 units of free power. More than one lakh power connections have been bifurcated since July 2022, when the free power scheme was announced.

“Consumers are applying for new connections and in some houses, we have over three meters. None of these connections gets a bill as their consumption is under 300 units. On a conservative average, it is adding over Rs 130 crore per month is the subsidy amount,” a top Punjab State Power Corporation Limited (PSPCL) functionary told The Tribune.

Even when the subsidised power with load up to 7 KW was announced by the previous Channi government, a large number of consumers with more than 7 KW load reduced their connected load to below 7KW to claim the benefits of the reduced bills.

“The wastage of power increases if it is given free. People are using 600 units in two months, sometimes installing three or more meters in a single house, while monitoring the meter so that the reading does not cross 10 units daily”, added a senior PSPCL official.

He said there was no provision with them to stop people from applying for more meters in a single house, when they complied with the relevant provisions.

Figures collected from PSPCL reveal that free power to domestic consumers has added a straight 16 to 20 per cent per month increase in power consumption,” said a senior official.


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