Relief for power consumers, tariff down by up to 50 p/unit

Ruchika M Khanna

Tribune News Service

Chandigarh, June 1

Amid Covid-induced economic crisis, the Congress government has announced a relief for domestic power consumers by reducing the tariff by Rs 0.25-0.50 per unit. The industrial and commercial consumers have been spared of any hike.

45 lakh
domestic consumers out of total 69 lakh will benefit

The tariff order, announced by the Punjab State Electricity Regulatory Commission (PSERC), will come into effect from June 1. Though all categories of 96 lakh power consumers in the state will see a drop in tariff as the average per unit realisation of power comes down from Rs6.62 per unit to Rs6.45 per unit, the government’s own subsidy bill will go up to over Rs10,100 crore (to be paid to 37 lakh consumers).

Capt hails move

CM Capt Amarinder Singh has welcomed the move to reduce domestic power tariff despite revenue gap resulting from the lockdown. He said his government had recommended even further reduction in tariff not just for domestic consumers, but also for industry.

The annual revenue requirement of Rs31,100 crore has been approved by the PSERC, against an Annual Revenue Requirement (ARR) of Rs33,250 crore.

The move will lead to an increased dependency of the PSPCL on government subsidy. This may not augur well for the fiscal health of the state power utility, which is still awaiting subsidy of Rs5,700 crore for 2019-20 and for first two months of this fiscal. In addition, the PSPCL is suffering a loss of Rs30 crore per day owing to lockdown.

The tariff cut will benefit 45 lakh out of total 69 lakh domestic consumers. Baldev Singh Sran, CMD, PSPCL, told The Tribune, “This is a positive development for domestic consumers, especially those in the lower strata.”

Energy charges for consumers using 100 units have been reduced by 50 paisa per unit (for those having a load of up to 50 kilowatts), while the tariff for those consuming up to 300 units has been reduced by 25 paisa per unit. Other consumers (using over 300 units and those having a load of over 50 KW) will have to pay a nominal increase of Rs0.01-0.10 per unit.

Not burdening the industry and trade, which has been hit because of the lockdown, the PSERC has retained the slabs of the last year. Only those commercial consumers having over 20KW load will have to bear an additional load of Rs0.01-0.03 per unit. Small and medium industrial consumers have been spared of any hike in tariff, although the tariff announced for large industrial consumers (having a load of over 100 kVAh) has been increased between Rs0.09 and Rs0.22 per unit.

However, since the government subsidises the industry by charging just Rs5 per unit as energy charges, the increase in tariff will have to be borne by the government.

An important decision to keep the night time tariff going has also been taken, wherein the units which work at night (between 10 pm and 10 am) will have to pay Rs0.38 per unit extra over last year (Rs4.83 per unit). This is a big boost to the industry, as the night-time tariff order has been increased from eight hours to 12.

Similarly, in case of agriculture pumpset consumers, where the government bears the tariff, the PSERC has increased the rates from Rs5.28 per unit to Rs5.57. This will increase the agriculture power subsidy bill from Rs6,660 crore last year to Rs6,810 crore this fiscal.

Relief for domestic electricity consumers

• Domestic consumers to pay Rs0.25-0.50 per unit less; 45 lakh to benefit
• No tariff hike for small commercial consumers
• 1-3 paisa per unit hike for those having over 20 KW load
• No change in tariff of small, medium industries
• Industries with over 100 kVAh load to pay 0.09-0.22 per unit more
• Rs0.29 per unit hike in charges on agri consumers, to be paid by govt
• PSPCL’s reliance on govt subsidy up as 1/3rd of total ARR to be met through subsidy release