Punjab faces threat of power shortage during forthcoming paddy season

CHANDIGARH: The annual power subsidy bill of the Punjab Government for the financial year 2022-23 is expected to cross Rs 19,000 crore. This is without considering a subsidy backlog of Rs 9020 crore.

Against this backdrop, the power sector is heading toward a crisis. Ahead of the forthcoming paddy season, the state is poised to face serious power shortages and outages if the Punjab State Power Corporation Limited (PSPCL) fails to arrange funds on time.

On February 1, the PSEB Engineers Association shot off a letter to Chief Minister Bhagwant Mann cautioning about the impending financial crisis and the consequential power crisis in the state. 

The letter noted that the financial position of PSPCL has been steadily deteriorating particularly due to non-payment of subsidies by the Punjab government and defaulting in payments by various Punjab government departments. 

"The authorities concerned in the Punjab government have deliberately underestimated the expenditure on power subsidy by almost Rs 7000 crore. Now with no budget provision for this big gap in expenditure, PSPCL is being forced to arrange funds on its own by way of loans from banks and financial institutions at high-interest rates. This will increase the overall cost of power for the ordinary consumers," the letter said.

Fuel Cost Adjustment (FCA), a major component of the tariff and allowed by PSERC time-to-time to compensate for the inflation in coal prices, has been kept pending by the Punjab government. 

"For the first time in the history of Punjab, the government has denied FCA which is another unrecoverable hole in the finances of PSPCL," the letter said.

"The inordinate delay in taking a final decision on filling important posts, which could have been planned to work around this crisis, i.e. the posts of CMD, directors in PSPCL and PSTCL, member PSERC, Chief Electrical Inspector is negatively affecting the efficiency of the state power sector. The sorry state of affairs has been further compounded by the interference of private consultants from a Bengaluru-based private company in the day-to-day decision-making of the power corporations,’’ it added.

The letter further stated that a new challenge due to "free 600 units of electricity has emerged and has resulted in an unprecedented peak in the power demand in the winter months for domestic consumers. Political patronage to the theft of electricity has not reduced, rather the free units of electricity have acted as an incentive for some unscrupulous consumers with political patronage, to keep unit consumption below 600 units at any cost, and vigilance activities by corporation staff are being thwarted by these unscrupulous elements.’’

Ajay Pal Atwal, General Secretary of PSEB Engineers Association said, "as per our information the government has decided to give around Rs 1,800 core to PSPCL out of the pending Rs 9020 crore.’’