Farmers may have to pay for power
PSERC says it will take this step if subsidy is not paid to PSEB
Jangveer Singh
Tribune News Service

Chandigarh, January 28
Farmers in Punjab are in danger of being charged full tariff for running their tubewells from March. The Punjab State Electricity Regulatory Commission (PSERC) has informed the state government that it will invoke Section 65 of the Electricity Act, 2003, in case the government does not pay the entire subsidy due to the Punjab State Electricity Board (PSEB) by the first week of March.

The government owes the PSEB Rs 1,038 crore as of January 1 this year. Besides this the government has not paid Rs 386 crore due to the PSEB on account of excess interest paid by the board on government loans as well as interest levied on the delayed amount of subsidy for the previous years.

The PSERC in a letter to the government recently has made it clear that it will invoke Section 65 of the Electricity Act, 2003, as well as charge penal interest on the delayed amount of subsidy in case the government does not liquidate its entire liability towards subsidy payment to the board by the first week of March.

Section 65 of the Electricity Act states that in case subsidy is not paid as directed by the commission, the order of the government for giving subsidised power supply will not be operative and the commission will have to issue orders for the levy of full charge from the consumers. The section also states that in case the government wants the distributing licensee to give power at subsidised rates, the government has to pay the subsidy quotient to the licensee in advance.

The government has regularly failed to pay the subsidy amount in advance to the PSEB even though the Regulatory Commission had changed the mode of payment from quarterly instalments to monthly instalments in its last tariff order. The recent financial crunch has resulted in a huge default.

In the letter written by the PSERC secretary, it has been pointed out that the commission had determined the amount of subsidy at Rs 3,144 crore for 2009-10. It said an analysis of the payment of subsidy by the government for the years 2007-08 and 2008-09 was made and it was noted that during these years though the government had paid the amount of subsidy as determined by the commission, it had been done in a staggered manner.

The PSERC noted that the PSEB intimated that the government had paid a subsidy of Rs 1,517 crore against Rs 2,261 crore due up to December 2009 and that Rs 294 crore had become due in January this year.