Subsidy stuck, PSPCL attempts to increase revenue

The Punjab State Power Corporation Limited (PSPCL) is trying to rev up its revenues in the wake of its increasing expenditure on power purchase because of the prolonged and severe summer and the non-payment of subsidy amount by the state government, which is itself grappling to meet its committed liabilities.

Engineers’ Suggestions

• The PSEB Engineers Association has suggested that there should be no power subsidy to consumers who are income tax payees or in public service
• Power subsidy should be allowed for only one connection on one premises
• Those who steal power should be debarred from availing any subsidy for five years

Tiding over financial crisis

• The PSPCL will save ~1,500 crore from withdrawal of subsidy to consumers having up to 7 KW load
• 9,000 agri consumers getting 24x7 power unauthorisedly will be given 8-hour supply by shifting them to agriculture feeders
• Rs 3,500 crore to be recovered from government departments
• Rs 1,800 crore to be recovered from defaulters who have not paid their power bills

Having notified its decision to roll back power subsidy given to domestic consumers having up to 7 KW load, the government is now mulling withdrawing the 24-hour power supply given to 9,000 agri consumers, whose tubewells are connected to rural domestic feeders. Their entitlement is for eight hours of power supply.

When the agri feeders were separated from domestic feeders in 2011-12, these 9,000 consumers, most of them having political clout, ensured that they remained attached to domestic feeders, so that they got 24 hour supply. Chief Minister Bhagwant Mann has reportedly given the go-ahead for attaching these consumers to the agri power feeders.

Official sources in the PSPCL told The Tribune that they were working on a multi-pronged strategy to shore up the revenue of the state power utility. “We are also working on recovering the Rs 3,500-crore power dues from various state government departments. The Chief Secretary is himself asking all departments to clear the dues of the PSPCL at the earliest and Rs 70 crore has been paid to the PSPCL in past one week,” said a top official in the state power utility.

It has also been decided to act against defaulters, especially domestic consumers, who have not cleared their power bills to the tune of Rs 1,100 crore. The total amount that all categories of defaulters owe to the PSPCL is Rs 1,800 crore. The power utility has also launched a programme to check power theft, and thus save power worth Rs 2,500 crore.

With the state government being cash-strapped, the PSPCL had a pending current power subsidy of Rs 1,300 till the end of August. Another instalment of Rs 1,800 crore is to be paid in September, against which only Rs 500 crore has been paid till date, inform official sources.

The PSPCL requires a monthly inflow of Rs 3,600 crore for power generation, transmission, power purchase and to meet its own expenses of salaries and other establishment costs. The utility has nearly exhausted its limit to raise loans. If the power subsidy is not released on time, the PSPCL will get only around Rs 1,800 crore revenue from power tariff deposited by consumers. Sensing tough (financial) days ahead, the authorities have decided to shore up their resources.