2009 will only add to PSEB’s miseries
Jangveer Singh
Tribune News Service

Chandigarh, December 27
The Punjab State Electricity Board (PSEB) enters 2009 in deep financial crisis and an uncertain future with no money to undertake the much-delayed restructuring exercise or assure regular power supply to its consumers.

Although the seeds of the revival of the board were sown this year with two units of 250 MW each of Lehra Mohabbat Stage II being commissioned and the 3x660 MW Gidderbaha project being awarded to a private player, besides the process to awarding the 1320-MW Rajpura and 4x660-MW Gidderbaha thermal plants still in process, these efforts will not have any effect on the board’s performance in 2009.

The financial position of the board is so precarious that there are fears that employees may not get their salary in time. The board’s commercial losses are likely to cross the Rs 2,000-crore barrier this year and accumulated losses are likely to be around Rs 9,000 crore.

The subsidy burden on account of free power to farmers and other consumers has increased from Rs 873 crore in 2004-05 to over Rs 2,800 crore in 2007-08. The state government has failed to pay Rs 1,320 crore to the PSEB in cash during 2007-08 and instead adjusted it against government loan, pushing the board into a serious payment crisis.

Non-payment of the subsidy quotient by the state government is increasing the dependence of the board on short-term loans, which have increased from Rs 895 crore ending March, 2006, to over Rs 6,500 crore, an increase of over seven times in just three years.

As far as restructuring of the board is concerned, the government is delaying the exercise fearing protests from employees, which it wants to avoid before the Lok Sabha elections. Lack of finances to meet the restructuring cost is also coming in the way of reformation, as new companies cannot be saddled with past losses.

Consumers will be affected in 2009 with power demand likely to touch 9,000 MW in summer against a supply of 6,500 MW. With a demand-supply gap of nearly 40 per cent, consumers may face power cuts of six or eight hours. With no generation being added immediately, the dependence on short-term power will increase and this purchase is likely to increase from 2,635 million units in 2007-08 to 4,990 million units in 2009-10.

At present, release of new domestic connections has a waiting period of 14 months whereas agriculture consumers are waiting for the past 16 years for connections.

On the plus side, the board took anti-theft measures this year by setting up five police stations, besides getting special courts designated to try energy theft cases. Efforts were also taken to reduce transmission and distribution losses by changing meters, shifting them out of premises of consumers and encouraging use of compact fluorescent lamps. This resulted in a 3 per cent decrease in losses in the first half of this year compared to the same period last year.