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Punjab industry electrified but cost to exchequer Rs 60-cr

The Punjab government’s reducing the regulator-announced power tariff for small-scale industry will cost the exchequer Rs 60 crore.

punjab Updated: Jul 29, 2016 10:54 IST
Gurpreet Singh Nibber
The subsidy bill for free electricity to agricultural pump-sets and other consumer sections is Rs 6,364 crore for current financial year and Rs 1,233 crore is unpaid from the previous year.
The subsidy bill for free electricity to agricultural pump-sets and other consumer sections is Rs 6,364 crore for current financial year and Rs 1,233 crore is unpaid from the previous year. (HT File Photo)

The Punjab government’s reducing the regulator-announced power tariff for small-scale industry will cost the exchequer Rs 60 crore.

Sources in power department say deputy chief minister Sukhbir Singh Badal, who heads the power department, is trying to woo coalition partner Bharatiya Janata Party (BJP) for a base among small industrialists and traders. They now foresee a tariff cut for domestic consumers and other sections left out on Wednesday. The decision to reduce tariff for small-scale industry further after Punjab State Electricity Regulatory Commission (PSERC) had given it relief was a calculated plan. The government had done the maths to know how far it could go to bring 85,000 consumers under sops. “It tried to include as many people it could without getting broke,” said an officer in the power department.

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“The PSERC also calculated tariff based on the financial scenario,” said the officer. It didn’t make power costlier for domestic consumers and wasn’t harsh on industry either but the Akali-BJP ruling coalition has a high-stakes assembly election to face in early 2017.

PSERC: Govt must recompense PSPCL

“When the state government asks the PSERC for a formal approval of the rates, it will have to not only bear the cost of the sops to the small-scale industry but also promise to make up for the PSPCL’s revenue shortfall with subsidy,” said PSERC chairman DS Bains.

Section 65 of the Electricity Act 2003 mandates that if the state government gives relaxation to any consumer section against the regulator-determined tariff, it will compensate the power corporation with an equal amount of subsidy in advance.

Also read: Power tariff cut for industry in Punjab, aam aadmi keeps looking for relief

Over and above pending subsidies

The subsidy burden of Rs 60 crore is over and above the total subsidy of Rs 7,597 crore to be given to the PSPCL.

The subsidy bill for free electricity to agricultural pump-sets and other consumer sections is Rs 6,364 crore for current financial year and Rs 1,233 crore is unpaid from the previous year. “We want subsidies on time to be able to run the corporation smoothly,” said a power corporation officer.

Gaushalas to get sops

The state government is going to give nearly 700 gaushalas the free power it had announced and the PSERC had not given for want of formal request from the government and the gaushalas. The state government is expected to announce the sop shortly.