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AUG 31 2017

Power tariff may go up in Punjab as state regulator calls for consultations

  • Economic Times, ET Bureau / Hyderabad
  • Created: Thu 31st AUG 2017


After a relief of over two years for consumers, the Punjab State Electricity Regulatory Commission (PSERC) has started the process to hike power tariffs. Revision of tariffs is likely in view of the poor financial health of the Punjab State Power Corporation Limited (PSPCL), which is reeling under a debt of over Rs 25,000 crore.

There has been no tariff revision for the last two years.The PSPCL has already filed a petition seeking a hike of around 20% in power tariff. A final decision in this regard is to be taken by the power regulator for which it has called a public hearing on September 5 and 6. The PSPCL has been called for the hearing on September 8.

Sources in the corporation, who have been instrumental in drafting of the multi-year tariff petition (MYTP) for years 2017-18, 2018-19 and 201920, said having joined the UDAY scheme for restructuring of the power corporation's debts, the state was to hike power tariffs by 9% per cent in 2015-16 and 6% in 16-17. However, there has been no increase in the electricity rates.

The deferring of tariff hike has added to the financial burden on the PSPCL, said sources, adding that the income from the sale of electricity was the main source of revenue for the corporation and the authorities had almost run out of other options.

As per the MYTP , there is a total revenue deficit of Rs 11,575 crore, including Rs 5,998 crore carried forward from the previous years, which had been mentioned as a major reason for seeking the tariff hike. In the MYTP, the corporation has shown a deficit of Rs 6,130 crore for 2018-2019 and Rs 6,406 for 2019-20.

Last year, the PSPCL had sought a tariff hike of 19.72% amounting to Rs1.56 per unit to bridge the revenue gap. The corporation had estimated revenue receipts of Rs 26,121 crore against the estimated expenditure of Rs 31,262 crore.However, the tariff hike was denied by the state government.

With the chief minister Amarinder Singh announcing power to industries at Rs 5 per unit, the PSERC will work out the cost of the electricity supply and ask the government to pay the subsidy for the gap, said sources.

Last year the average cost of supply had been worked out at Rs 5.97 per unit. Sources said considering the power purchased by the PSPCL, the cost of supply would be reworked and in case it was more than Rs 5 per unit, the government would be asked to chip in the additional amount. The tariff revision would be implemented in retrospect from April 1 this year, said sources.


Punjab TOTAL Tariff Hike Tariff Electricity Regulatory Commission Punjab State Electricity Regulatory Commission Power Electricity PUNJAB

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