THIRUVANANTHAPURAM: The Kerala State Electricity Board (KSEB) is currently facing monthly losses of Rs 120 crore after limping back from the pandemic. The board could manage to stay afloat during this period just because of the surplus power being sold through the power purchase agreement (PPA). If the tariff was increased by 7.32 per cent in 2019, now the board is expected to put forth a proposal before the Kerala State Electricity Regulatory Authority (KSERA) for at least a 12 per cent hike to rebound from the losses.
The regulatory authority need not approve the board's proposal. It will be holding public hearings with stakeholders from across the state for at least two months before the revised tariff rate is announced by the end of March leading to the new rates coming into effect from April 1.
During the 2017-18 period, the regulatory authority had approved the board's loss at a whopping Rs 6,864 crore. That led the board to go for a power tariff hike in 2019 at 7.32 per cent when the KSEB's revenue was Rs 902 crore. The board's audited accounts during the current fiscal year show a loss of Rs 1800 crore. But interestingly, the bad debt being incurred by the board is Rs 3100 crore which has to come through fixed charges and subsidies. P S Prasanth, general secretary of the Kerala Electricity Officers Confederation, told The New Indian Express that the board's annual revenue is Rs 14,000 crore while the yearly expenditure is between Rs 15,500 crore - Rs 16,000 crore.
"Sixty per cent of the total revenue is utilised for purchase of power. Nearly Rs 9000 crore is required for annual power purchase. During the pandemic, the board could survive because of the PPA. When north Indian states faced acute coal shortage during October, we managed to sell one unit of power at Rs 19," said Prasanth.
It is the regulatory commission that approves the PPA. The board had run into rough weather over the PPA many times. Former Opposition leader Ramesh Chennithala had alleged that the then LDF government had awarded the contract to the Adani Group just before the 2021 Assembly elections which the board denied. Now the KSEB is facing a situation where there is no alternative but to submit a proposal for power tariff hike before the regulatory authority by December 31 to tide over the losses. The Centre's move to privatise power distribution is another threat looming large in front of the board now.