Power cuts cause heavy losses to Uttarakhand SMEs

The Uttarakhand government may have decided to set up one more industrial estate and a knowledge hub in Kumaon region to attract fresh investments.

But for existing manufacturing units, the huge shortage of electricity has become a big stumbling block to smooth functioning. Unscheduled power cuts have forced industry to use diesel generators, which are turning out to be a very costly proposition.

Ashok Windlas, managing director, Windlas Biotech Ltd, a pharmaceutical unit based in Dehradun, said, “We are suffering losses of Rs 8-10 lakh per month due to power breakdowns.” Against a tariff of Rs 4.5 per per unit charged by Uttarakhand Power Corporation Ltd (UPCL), the sole power distributing utility, Windlas said the cost of running a diesel generator is Rs 8-9 per unit.

Similarly, V K Dhawan, the owner of the Selaqui-based industrial estate for SME units, said manufacturing there are losing money due to the heavy power cuts. “When there is a power cut, we have to run generators, which increases the cost of production. Order fulfilment also gets delayed,” said Dhawan.

In the first two weeks of August, heavy and unscheduled power cuts have proved especially costly for industry, especially for SMEs, which are unable to afford power backup arrangements. As a result, production suffered.

“We have spoken to the chief minister and have lodged our protest against the huge shortage of electricity in the state. But we are still reeling under blackouts,” said Pankaj Gupta, president of the Industries Association of Uttarakhand (IAU), a body representing SME units in the state.

The power-related losses of over 30,000 micro units in the state are unaccounted for, due to non-availability of data.

According to Madhusudan, a spokesman of UPCL, the hill state is facing a deficiency of three to four million units of power every day.

Rakesh Sharma, Uttarakhand’s principal secretary, industrial development, conceded that industry was affected by heavy power cuts but expressed optimism that the situation would improve. “We are finding out ways for solving the problem,” he said.

Yogesh Jindal of Kashipur-based Kashi Vishwanath Steels (KVS) Ltd said all the 40 small steel units located in the state are losing money due to power breakdowns. Unlike other units, which can be run through power backups, steel units are generally shut down during outages.