Fiscal Year 2010-2011
PSEB has demanded 51% hike in power tariff
Sarbjit Dhaliwal
Tribune News Service

Jalandhar, January 21
Hold your breath for a while. The Punjab State Electricity Board (PSEB), which is in dire fiscal straits, wants a whooping increase of about 51 per cent in the existing tariff across the board for all consumers to meet its aggregate revenue requirement (ARR) for the next fiscal year (2010-11). For the current fiscal year, the increase in the tariff, ordered by the Punjab State Electricity Regulatory Commission (PSERC) was in the range of 10-12 per cent for various categories of consumers to generate a revenue of Rs 759 crore to meet its ARR.

The PSEB has pegged a cumulative revenue gap of Rs 6,575 crore in the petition submitted to the PSERC for the next fiscal year and has prayed to the commission to raise the tariff accordingly to realise the amount from the power consumers. The commission has sought objections from the public on the petition.

How the commission would deal with such a huge increase in the tariff, it remains to be seen. Already, there is a difference of opinion in the PSEB and the commission over the consumption of power in the farm sector. The commission had last year reduced the projected consumption in the farm sector by about 10.2 per cent on the basis of an independent survey report. From the next financial year, the farmers would have to pay Rs 50 per BHP per month. That means a farmer owning a 10 BHP power motor would have to pay Rs 500 per month and the remaining part of the bill would have to be paid by the state government through power subsidy.

As the PSEB has projected its line losses at about 20 per cent -- though experts say that these were much higher than the project figure -- it loses a revenue of about Rs 2,754 crore, owing to line losses. As compared to international standards, the PSEB line losses are very high.

Projecting its revenue requirement, the PSEB has projected to spend Rs 3,623 crore on fuel and Rs 5,876 crore on the purchase of power. It has shown employees cost of Rs 3,587 crore. Interestingly, the expenditure during 2010-11 would go up to Rs 3,587 crore from Rs 2,747 crore, perhaps because of the revision of the pay scales. The PSEB would pay Rs 1,952 crore as interest. For the next fiscal year, it has shown a revenue gap of Rs 2,890 crore.

However, the cumulative revenue gap has been pegged at Rs 6,575 crore. It includes revenue gap of Rs 1,454 crore for 2008-09 and Rs 2,231 crore for 2009-10. The PSEB has included the figures of revenue gap of 2008-09 and 2009-10, arguing that the commission did not give it due revenue during the current and last fiscal year. The PSEB has pegged generation of revenue from the existing tariff at Rs 13,722 crore during the current fiscal year. It includes a subsidy of Rs 3,205 crore for farm sector and poor sections of society to be paid by the state government.