The Durgapur Projects Ltd, a West Bengal government undertaking, suffered a loss of Rs 21.24 crore in 1996-97 against Rs 4.15 crore only in 1995-96. The accumulated losses of DPL has now increased to Rs 128.61 crore.
Despite an increase in losses by Rs 17.08 crore, the increase in accumulated loss was limited to Rs 5.98 crore only thanks to the adjustment in fuel surcharge and waiver of the accumulated interest on government loan amounting to Rs 8.07 crore and Rs 8.15 crore, respectively.
DPL is a unique case where the company's finances deteriorate if the power generation improves. It makes money only from the sale to its own consumers.
The export of rest of the generation to the West Bengal State Electricity Board (WBSEB) causes a huge loss.
The company's power generation in 1996-97 was among the highest in its history. The generation of 1011 million unit against 905 mu the previous year was significant as it was only the fourth occasion in DPL's history that the generation crossed 1000 mu.
In fact, all but one areas of operation of DPL proved to be loss-making in the year as was the case the previous year. What is alarming is that the losses for 1996-97 showed a sharp increase in the most important areas of power plant, coke oven plant and coal washery. The spun pipe unit showed a decline in loses.
The only area of profit-making was the water works. DPL supplies water for almost all the industries in the Durgapur industrial belt. Profit for the year was Rs 80.82 lakh against Rs 42.08 lakh in 1995-96.
It is an irony that the better the performance of DPL's power generating units, the higher is the loss. DPL makes money only by selling power to its own consumers which fell to 222 mu from 241 mu in 1995-96.
The fall in local demand is attributed to low demand from the Hindustan Fertiliser Corporation and Graphite India by about 50 mu.
The situation was somewhat saved by higher offtake by two other industrial units and commercial and domestic consumers. The net fall in local sales was 19 mu only.
The company sold 750 mu in 1995-96 for a revenue of Rs 109.78 crore reflecting an average tariff realisation of Rs 1.46 a unit. But, the 1996-97 sale of Rs 117.52 crore from 847 mu meant an average tariff realisation of Rs 1.39 a unit. The tariff realisation thus fell by 7 paise a unit.
Therefore, despite a generation increase by 11.7 per cent and sales increase by eight per cent, the higher income was offset by 17.4 per cent increase in expenditure, mainly on account of coal cost.
Since WBSEB paid for the power import at 'pool rate', much of the increased expenditure could not be neutralised. This caused an increase in power plant operation from Rs 4.21 crore in 1995-96 to Rs 15.74 crore in 1996-97.
The power generation in the first four months of 1997-98 was 270 mu against 334 mu in April-July 1996. The target for the year, however, has been set at 1000 mu.
