The reported communication of Secretary/Power addressed to Chief Minister Punjab and Chairman, PSEB appearing in section of the press advising imposition of power cuts in the state to save the Board from financial crisis, is similar to the suggestions given few days by his colleague bureaucrat posted in the Board.

It is hard to believe that such suggestions by two different bureaucrats are just coincident. It is not understood why these functionaries of the government are so desperate to impose power cuts in the state. The questioning of power procurement made by PSEB to ensure “power-cut free” summers in the state shows total lack of understanding of the dynamics of power sector operations.
By quoting some selective data from a web-site, it has been alleged that PSEB procured more power and at higher rates as compared to other sates. The data available on the internet also shows that costliest power was purchased by Tamil Nadu and Delhi at the rate of more than Rs 8 per unit and Rs. 8.4 per unit respectively whereas the costliest power purchased by PSEB was at the rate of Rs. 7.11 per unit. The same power has also been purchased by Delhi, Haryana and Rajasthan at the same rates. Even Ranjit Sagar Dam power is costing PSEB around Rs 6 per unit. As per the logic of Secy/power, this power was also required to be surrendered or offered to other states. As per available data on the web-sites, it is evident that the cost of traded power has increased by more than 200% in the last 3 years. The Himachal power which was available for Rs.2.70/U is now being sold for over Rs.7/Unit. Similarly, the eastern region power rates have increased from Rs.2.30 to over Rs.6 per unit. Why these facts were concealed by the Power secretariat while putting up the case to Chief Minister, Punjab? Association demands clarification on this issue.
Northern states are the most power deficit states of the country and all these states are in race to grab all the available power in the system. Last year, despite heavy power purchases, three to four hour power cuts were imposed on the Industrial/urban consumers and more than 7 to 8 hours on rural domestic consumers. The power intensive industry was even closed for almost 15 days. Had there been less power procurement, the power situation would have been worse leading to “power-riots”. This year, PSEB has supplied atleast 15% more power to the consumers as compared to last year even though not a single MW of generating capacity has been added by the state since commissioning of RSD in 2000-01 and rain fall deficit is more than 23%. Most of this additional power has been given to industrial and general consumers as the first priority of the Board is to ensure minimum 8 hours supply to tubewells and remaining power available is sold to other consumers of the state. So any shortfall in power procurement means imposing proportionate power cuts on paying sectors viz industry and domestic consumers thus affecting not only the revenue flow to the Board but also entire economy of the state.
After the enactment of Electricity Act 2003, the power trading and procurement has become a highly commercialized and complicated activity covered under new concept called “Open Access’. Where as the power is contracted from a supplier through trader, the transmission corridor through which this power would flow to the state, is booked by another agency.
Due to transmission capacity constraints, only around 1000 to 2000 MW of power can flow from other regions to the Northern states against the requirement of about 3000 to 4000MW. The transmission corridors are booked three months in advance and in order to get the maximum possible corridor, the states also tie up powers in advance. All these decisions are taken in anticipation of possible demand supply scenario and policy directions of the state government
The generating companies are giving power to highest bidding trader to maximize its profits and the trader inturn offer the same power to deficit states on first cum first serve basis. PSEB being a vertically integrated utility with unified control is in a better position to place its orders in a prompt manner as per its requirements.
It is a matter of record that not even a single unit of power available in the system remain unsold due to high cost. In case one costly power is tied up by one state and other has been tied up by some other state. As the per capita consumption of Punjab is the highest in the country and annual consumption of 34000 MUs is much more than the requirement of other northern states so requirement of power is also much more than these states.
The failure of the state government to add any new generating capacity in the state during the last 6 years, is primarily responsible for over dependence on power purchases. Association has been highlighting the need to develop own generation capacity in the state but the same was ignored. Even now the state government by showing over dependence on the private sector to add entire proposed generation capacity in the state is committing a grave mistake of far reaching consequences.

(Er.R.S.Sarao) (Er.H.S.Bedi)
General Secretary President