Sukhbir’s parting gift for Capt: Surplus power, no one to buy it
According to state power minister Rana Gurjit Singh, the state has surplus power to the tune of over 3,000 MW from the three private power plants set up by his predeccesor Sukhbir.Updated: Apr 24, 2017 10:12 IST
A month into power, the Captain Amarinder Singh government seems to be at its wits’ end with the parting gift of former deputy CM Sukhbir Badal — power-suplus Punjab!
According to state power minister Rana Gurjit Singh, the state has surplus power to the tune of over 3,000 MW from the three private power plants set up by his predeccesor Sukhbir.
But it has no one to buy it. Worse still, the previous government has left an unenviable legacy of debt and empty coffers. Yet the cash-starved state has to pay fixed costs of these three plants out of its own pocket even when it could buy cheaper power from private producers outside the state.
When Amarinder went to woo industry honchos to Mumbai last month, Reliance Anil Dhirubhai Ambani group head Anil Ambani pointed to “huge losses” incurred by Punjab due to purchase of power at high cost and offered power to the state at ₹1.75 per unit. To much embarrassment of the Punjab delegation led by the CM, the state was trying to woo the industry with ₹5 per unit, as promised in the party’s poll manifesto.
The per unit fixed cost being borne by the state as per the power purchase agreements (PPAs) with the three private plants at Rajpura, Talwandi Sabo and Goindwal Sahib is almost what Ambani was offering to charge the state for power!
Looking beyond borders
With no takers for its surplus power, Amarinder, like Sukhbir, decided to look beyond borders. The CM met Prime Minister Narendra Modi to seek permission to supply power to Pakistan and Nepal.
The possibility to do so seems far-fetched for now while the state’s concerns are urgent. Other than the fixed costs of the three private plants, it has no money to foot the subsidy bill for free power to farmers and poor families. The government has been already defaulting in payment of subsidy to Punjab State Power Corporation Limited (PSPCL) and even a part of the subsidy for 2015-16 fiscal remains unpaid.
So the new government is finding itself in a rather piquant situation. The state has surplus power for nearly eight months when the demand plummets to 3,500 MW. But it still has to bear the fixed costs of these plants. For remaining four months, it faces a shortage as the power demand peaks to 12,000 MW due to paddy-sowing and summer heat forcing it to buy power from outside the state at high rates.
Caught in the web of Sukhbir’s making, the Amarinder government has realised ₹5 per unit power is a poor bait to woo big industry. “We are obliged to buy power from the private plants under the purchase agreements. So we have to create demand for power. For this, we need more industry. The CM also met PM Modi to allow us to export power to Pakistan,” Rana Gurjit said.
Punjab finance minister Manpreet Badal too sees industry as the way out of the financial crisis as it will help create jobs and revenue for the state where agriculture sector too is showing no growth. The industry will also help Punjab pay its bills for “power surplus” tag.
First Published: Apr 24, 2017 08:55 IST