PSPCL struggles as govt depts owe Rs 2,500 cr in power dues

The Punjab State Power Corporation Limited (PSPCL), struggling with a financial crunch, has resorted to loans to pay salaries, pensions, and meet operational expenses as several government departments continue to default on payment of electricity dues. Four departments alone account for over 90 per cent of the total pending amount.

According to the PSPCL data, state government departments owe a combined Rs 2,582 crore. The major defaulters include the Water Supply and Sanitation Department (Rs 1,013.7 crore), Local Government (Rs 852.4 crore), Rural Development and Panchayat (Rs 382.8 crore), and the Health and Family Welfare Department (Rs 127.4 crore). Together, these four owe Rs 2,376.3 crore, or 92 per cent of the total.

Other departments such as the Sewerage Board (Rs 61.7 crore), Home Affairs (Rs 23.9 crore), Public Works (Rs 10.2 crore), and School Education (Rs 21 crore) collectively owe Rs 116.8 crore, while 46 smaller departments together owe about Rs 89 crore.

Last year, the Punjab State Electricity Board Engineers’ Association (PSEBEA) urged the Punjab State Electricity Regulatory Commission (PSERC) to take suo motu notice of the pending government payments to protect public interest.

Zone-wise, the South Zone leads in defaults at Rs 677.2 crore, followed by the Border Zone (Rs 621.6 crore), West Zone (Rs 600 crore), North Zone (Rs 395.6 crore), and Central Zone (Rs 287.6 crore).

In 2023, despite repeated extensions to a one-time settlement (OTS) scheme approved by the PSERC, major defaulters did not clear 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 commission approved it for three months but extended it twice with not much response,” said a senior PSPCL functionary.

Facing fund shortages, the PSPCL took an additional Rs 800-crore loan in January 2024 to avoid defaulting on power purchase and statutory payments. “Loans have to be taken for the payment of power purchase cost, coal cost, railway freight and other unavoidable expenditures,” said a senior official. A former PSPCL Chief Engineer confirmed the loan and cited political compulsions as a key factor.

“We do not disconnect their power supply as it will only affect the common man,” another officer stated.