Cash-strapped PSPCL in further trouble Power corp may not be able to meet farmers’ power demand

Submitted by lovekesh on Fri, 30/09/2011 - 6:23am

Cash-strapped PSPCL in further trouble
Power corp may not be able to meet farmers’ power demand
Umesh Dewan
Tribune News Service

Patiala, September 29
Senior functionaries of Punjab State Power Corporation Limited (PSPCL) and power experts foresee serious repercussions with Punjab’s power entitlement cut from 54.5 per cent to 51.8 per cent from the hydel power in Himachal Pradesh.

With the apex court upholding Himachal’s claim of 7.19 per cent share in the Bhakra Beas Management Board (BBMB) projects, the power corporation, already reeling under a power crisis, will now get 75.1 MW less power. This will make meeting the power needs of the agriculture sector difficult. Also, the PSPCL would have to purchase power from outside at a much higher rate.

Figures procured from the PSPCL headquarters show that the annual power requirement for the agriculture sector in the state is about 90000 lakh units (LU). In the wake of the reduction in Punjab's share, Punjab will be power deficit by at least 3000 lakh units annually.

Rough estimates show that Punjab gets power from hydro projects in Himachal at 20-25 paise per unit. Now if the power corporation purchases power from outside the state, it will not be less than Rs 4 per unit, which would mean an additional burden of Rs 110 crore-Rs 120 crore on the state of Punjab.

PSPCL Director (Distribution) Arun Verma said: "As of now, it is difficult to make any categorical statement on the issue. We are yet to receive a copy of the court orders, but there is no doubt that the power deficit in the state will go up."

He said the possibility of an increase in the power tariff in Punjab could not be ruled out. Senior officials said that in order to meet the power demand during the paddy season, the power corporation would have to purchase power from outside Punjab at much higher rates, which would drastically increase the financial burden on the power utility, already passing through one of the worst financial crisis.

A senior expert in the power sector Padamjit Singh said: "Till now, the power corporation was able to sustain the power requirement because of the low-cost power from Himachal’s hydro projects. The apex court verdict has come at a stage when the power corporation is in a debt-trap to the tune of thousands of crores and the fiscal health of the power utility is deteriorating each passing day."

He said if the power corporation was unable to meet the power requirement of the agriculture sector, this could create a food security problem in the entire country as Punjab was a major contributor of foodgrain to the central pool.

A senior officer said: "It is shocking that having surplus power during the summers, Himachal would be selling excess power at Rs 4.30 in the market, making huge profits, whereas Punjab, which remains power deficit during the summers, will have to buy power from outside Punjab at much higher rates. “This is not in the larger interests of the country as Punjab remains the major contributor to the country’s food stock.

Current Affairs

With Punjab’s share in Himachal’s hydel projects cut from 54.5% to 51.8%, Punjab will now get 75.1 MW less power than before
Subsequently, the state will see a power deficit of 3,000 lakh units annually
The power corporation is already in a debt-trap to the tune of thousands of crores
If it purchases power from outside, this will entail an additional burden of Rs 110 crore-Rs 120 crore