Power com grappled with pending subsidy, rising thefts

Despite failure of the Punjab Government to clear subsidy bills on time, rising power theft and several departments not paying the bills for electricity consumed, the Punjab State Power Corporation Limited (PSPCL) has raked in a profit.

In 2024, the PSPCL earned a profit of Rs 2,685 crore during the peak season ending October, against a profit of Rs 565 crore during the corresponding period last year.

This became possible due to supply of coal from Pachhwara coal mine, which has not only improved thermal generation at Ropar and Lehra Mohabbat but also at the newly acquired Goindwal plant.

The PSPCL purchased 540MW GVK thermal plant at a competitive cost of Rs 1,080 crore, which ensured reliable and cost effective power supply to the consumers.

Following the profit, the PSPCL has envisaged only a minimal increase of 10 per cent in tariff for 2025-26, which is lowest in the past 15 years.

The Punjab State Electricity Regulatory Commission (PSERC) would analyse and apply stringent checks on submission of the PSPCL and would decide the tariff before March 31, 2025.

Moreover, the government has withdrawn Rs 2.50 per unit subsidy given to consumers with load up to 7KW.

Challenges

The rising power demand, which crossed 16,000 MW this paddy season, has been a cause for concern.

This surge has been attributed to changing weather patterns, accelerating economic activity and rising agri-sector demand. In the recent paddy season, the state faced a shortage of 900 MW, resulting in unscheduled rotational power cuts across the state.

“The power demand is likely to increase by around 4,000 MW in the coming years at an estimated rate of 7 per cent every year. There is an urgent need to set up two 800 MW supercritical units at Ropar thermal plant and a solar plant in Bathinda,” said a former Chief Engineer of the PSPCL.

Power theft

Power theft has assumed alarming proportions, despite domestic consumers getting free electricity. The losses touched a whopping Rs 2,600 crore in 2023-24.

In lieu of 300 units of free power, the state government gives a subsidy of over Rs 6,000 crore and Rs 1,400 crore was given against Rs 2.50 rebate to domestic consumers — up to 7KW load.

There are 20 notorious theft-prone divisions of the PSPCL, which account for half of the Rs 2,600 crore revenue loss. The maximum power theft occurs in the border zone, followed by west and south zones.

Financial challenge

On the financial side, the Punjab Government continues to delay the subsidy payment and recovery from several defaulting departments.

While the outstanding subsidy bill stands at Rs 4,500 crore, the past subsidy dues and unpaid electricity bills of government departments stand at Rs 5,500 crore and Rs 3,600 crore, respectively.

The Punjab Government has paid subsidy of Rs 12,758 crore to the PSPCL till December 15.

Highs

In 2024, the PSPCL earned a profit of Rs 2,685 cr during the peak season ending October

This became possible due to supply of fuel from Pachhwara coal mine in Jharkhand

The acquisition of 540MW GVK thermal plant at a competitive cost of Rs 1080 cr

Lows

Outstanding subsidy bill and the past subsidy dues stand at Rs 4,500 cr and Rs 5,500 cr

The power demand is likely to increase by around 4,000 MW in the coming years

Power theft touched Rs 2,600 crore in 2023-24, despite consumers getting free electricity