In poll-bound Punjab, power consumers get tariff relief

No revision for domestic consumers; MSMEs to get concession

It's raining sops during the election year in the poll-bound Punjab and the latest is relief in power tariff to industry and domestic consumer. Punjab Deputy Chief Minister today announced that there would be no tariff revision for the domestic consumers and MSMEs in the state would be offered power at a concessional tariff.

This would incur an estimated Rs 250 cr per annum financial burden on state power utilities already reeling under losses. The doles announced in 2016-17 budget put a burden of Rs 1,200 cr on the state government and cash starved state government has no clarity on implementation of seventh pay commission's recommendations. 

Badal today announced peak load hours restrictions surcharge of Rs 2 per unit has also been waived off thereby provided a big relief of Rs 200 crore per month to the industry. Sukhbir Singh Badal announced that small scale industries would be provided power at Rs 4.99 per unit which was Rs 5.85 per unit earlier thereby giving a relief of Rs 86 paisa per unit. He stated that this reduction would cost Rs 50 crore on state exchequer and Punjab government would provide this subsidy to the industry.

Similarly, the medium scale industry would get power at Rs 5.99 per unit while earlier it was Rs 6.38 per unit and the large scale industry would get power at Rs 6.35 per unit whereas earlier it was Rs 6.46 resulting in reduction by 36 and 11 paisa per unit respectively.

Announcing a major initiative, the Deputy Chief Minister said the peak load hours restrictions surcharge was earlier being levied at Rs 2 per unit on the industry but now this charge has been waived off thereby giving a relief of Rs 200 crore per month to the industry. He also said this would lessen the use of generators leading to decrease in the environmental pollution in the state also.

Ruling parties mostly resort to such announcements to catch vote banks during election year but here in Punjab, the state had signed an MoU with Government of India and Punjab State Power Corporation Limited in March this year under UDAY (Ujjwal Discom Assurance Yojna) Scheme that binds the power corporation to revise power tariff in the next few years to equate the average cost of power generation and average revenue received. He remained silent on state’s commitment on revival of distressed power discom.

PSPCL has an outstanding of Rs 1,700 cr that includes Rs 1,200 on account of agriculture and other subsidies from Punjab Government and Rs 500 cr from different departments of state government. The annual power subsidy bill of Punjab is Rs 5,400 cr.  The total power generation capacity of Punjab is 10,500 Mw and eight months of the year it remains power surplus by 5,000 Mw to 6,000 Mw. Demand for power goes up during the sowing season by farm sector.