Subsidy eats up revenues, no outlay for projects

CHANDIGARH : The entire ₹12,248crore allocated for the power sector by finance minister Manpreet Singh Badal in the state 2020-21 budget will go for giving free and subsidised electricity to different sections of consumers.

The finance minister announced ₹8,275 crore as subsidy to Punjab State Power Corporation Limited (PSPCL) for supplying free electricity to at least 13-lakh tubewells being used for agriculture in the state.

A sum of ₹2,267 crore will go for subsidised power at a rate of ₹5 per unit to industrial sector, and ₹1,705 crore for subsidised power to domestic consumers belonging to SCS, BCS and other sections.

The requirement for subsidised power to the industrial sector may go up as in case there is increase in consumption during the forthcoming fiscal. “We have recorded an increase of 17% in industrial sector consumption since 2016-17 fiscal,” Manpreet said, adding that more power consumption in the sector means growth.

In the current financial year, Punjab government still owes PSPCL ₹ 6,931 crore against power subsidy which will add up in the subsidy bill for the forthcoming fiscal. “We are clearing the backlog also,” announced the finance minister on the floor of the House. The budget document is also silent on fund allocation to clear the backlog.

The FM also announced that PSPCL has registered a profit of ₹80 crore in 2018-19 for the first time in many years and there was a fall in transmission and distribution losses from 14.46% in 2016-17 to 12.04% in 2018-19. But the minister didn’t mention accumulated losses and debt pile up.

Manpreet proposed to strengthen the distribution network of 47 towns having a population of 30,000 and above under the Centre-sponsored Accelerated Power Development Reforms Programme (APDRP) in rural and suburban areas under the Deen Dyal Uadhyay Gramin Jyoti Yojana (DDUGJY) with an outlay of ₹252 crore.

Announcing other projects for the PSPCL, the FM said the government has taken initiative to install smart meters on all connections with a load of 20KV and above in the first phase. A pilot project has been started to link all services to helpline number 1,912 in five sub-divisions.