E-Paper
Punjab industry demands power tariff declaration before April 1
Power consumers file objections and suggestions before Punjab State Electricity Regulatory Commission, which is in process of finalising power tariff for upcoming year
The Punjab industry has asked for timely announcement of power tariff for the financial year 2022-23, so that they can plan out their manufacturing expenditure well in time.
The matter was highlighted in the objections filed before the state’s power regulator – Punjab State Electricity Regulatory Commission (PSERC), which is in the process of finalising power tariff for the upcoming financial year.
State power utility – Punjab State Power Corporation Limited (PSPCL), which is supposed to file replies to the objections, has shifted the onus on to the PSERC as the declaration of tariff is the prerogative of the power regulator, as per the Electricity Act 2003.
According to the industry, timely declaration of the tariff, to be applicable from April 1, will save the Punjab government from the complication of bearing arrears. In case of a delay, the industry had demanded that the tariff order be issued prospectively.
On cross-subsidy levels
Consumers have also cautioned the PSERC against increasing cross-subsidy levels (one consumer section paying higher rates so as to provide subsidy to the other) from plus/minus 20%. “In fact we demand reduction in cross subsidy by giving equitable tariff to all sections as the appellate tribunal for power sector has asked the state electricity board to work out a trajectory to reduce cross subsidy,” demanded the consumers.
“We spend a lot of time examining each and every objection filed by the consumers and take it into account at the time of ascertaining the tariff,” said a PSERC functionary.
The cross-subsidy burden on industry was 47 paise per unit in 2016-17 which increased to 65 paise in 2021-22, the industry highlighted in the objection filed before the PSERC, asking it to critically examine the claims filed by PSPCL and reject the excess claims.
Widening revenue gap
In its tariff petition for the year 2022-23, filed last November, the PSPCL projected a revenue gap of ₹125 crore.
As per the annual revenue requirement (ARR) filed by PSPCL, the gap of previous years amounts to Rs. 1,611 crore thus making a total revenue gap of Rs. 1,912 crore. The total ARR has been worked out to Rs. 36,484 crore and the revenue receipt has been pegged at Rs. 36,702 crore. The financial burden on PSPCL has increased further due to the subsidies and freebies announced by the Charanjit Channi-led Congress government ahead of the state assembly elections. The total expenditure thus in 2021-22 is estimated to touch Rs. 12,245 crore and as per ARR, it is expected to reach ₹13,929 crore Rs. in 2022-23.
The Chamber of Industrial and Commercial Undertakings (CICU) demanded to adopt the latest technology in transmission and distribution of power. “The PSPCL is using the same old equipment and technology. There are no efforts to use smart grids and distribution system automation to reduce outage time,” the chamber said, adding that no efforts were made by the PSPCL to recover hefty dues from the state government bodies in the form of subsidies, excess interest paid to state government and tariff gaps of the previous years.
Replying to the matter, PSPCL has said that it had sent repeated reminders to the state government to clear the dues to the tune of Rs. 7,175 crore.
As per the ARR, the quantum of expenditure goes into purchase of power, which is estimated at ₹24,910 crore, including the wheeling charges. The PSERC has received suggestions to shift to cheap power generation methods.
