Govt owes ₹6,414 crore to PSPCL against power subsidy bill
PATIALA The poll promise of free and subsidised power is proving dear to the Punjab State Power Corporation Limited (PSPCL) as the state government continues to default on compensating it fully for the seventh year in a row. The shortfall in payment from the government to the power corporation against the power subsidy bill touched a whopping ₹6,414 crore last fiscal, which is expected to increase further in the election year (2022).
The Punjab government is giving free electricity to agricultural tubewells, 200 units of free power to Scheduled Caste (SC) families and some weaker sections of society, besides giving subsidised electricity at ₹5 per unit to industry.
As per the data compiled by the PSPCL for the 2020-21 fiscal that ended on March 31, Punjab government had paid only ₹9,986 crore against the power subsidy bill of ₹16,400 crore decided by the Punjab State Electricity Regulatory Commission (PSERC), leaving a gap of ₹6,414 crore.
The government paid ₹6,743 crore in cash and the remaining were book adjustments in lieu of interests of Uday Bonds, infrastructure development fee, and electricity duty that the government collects.
“Though, the government has paid more than the previous years, but it has defaulted almost 40% of the subsidy amount. For the last seven years, the default is increasing every year, forcing the PSPCL to take loans for working capital,” said a power engineer on condition of anonymity.
Officials said PSPCL chairman-cum-managing director (CMD) A Venu Parsad has taken up the matter with the finance department repeatedly, but the issue is yet to be resolved.
In fact, the arrears of last six fiscals, which amount to ₹6,500 crore (approx), had put the state government and subsequently the PSPCL under a financial stress. The power regulator had even given liberty to PSPCL to discontinue free power supply if the state government fails to pay up. However, the PSPCL never challenges the government on this account as the power subsidy is a political issue in the state, said an official.
Every year, the default amount is passed on to the next fiscal. If ₹6,414-crore arrears of this year is passed on to the next year, the power subsidy bill will stand at approximately ₹17,000 crore. And previous trends show that the shortfall increases in an election year, as the government pumps in more funds for development works.
Despite repeated attempts, additional chief secretary (power) Anurag Aggarwal could not be contacted for his comment.