Rs 15,000cr dues make TS Discoms cry for tariff hike

Hyderabad: The future of TS Discoms is worrying the power department. From the next financial year, the state’s departments of agriculture and irrigation will become major consumers of Discoms. 

The two departments have to pay around '15,000 crore to the Discoms towards power consumption. Going by past experience, power officials doubt the charges will be recovered from the government departments despite Chief Minister K. Chandrasekhar Rao’s assurance that the irrigation and agriculture departments will pay the bills.  

As of today, the government departments owe about '4,000 crore. In addition to this, the state government has to pay about '6,000 crore to Discoms towards additional power purchase, tariff subsidy, additional costly power purchase and others. 

At present the Discoms are supplying power of about 1263 MW to lift irrigation projects such as the Devadula, Alimineti Madhavareddy project, and the Kalwakurthi, Nettempadu, Koilsagar and Bhima projects. Once  Kaleswaram and other lift irrigation projects are completed, the irrigation department will have to supply about 11500 MU of power to operate these projects. The Kaleswaram irrigation project alone will require about 1400 MU, the Discoms estimate. 

According to TS Transco’s estimates, after all ongoing lift irrigation projects are completed, the irrigation department will have to pay about '7,500 crore towards power consumption. 

The state government is supplying free power in the agriculture sector from January 1, 2018. There are about 23 lakh agriculture pump sets in the state and to supply free power to all these pumps sets requires 7000 MW of power, Transco estimates.  That will cost about '6,000 crore to '7,000 crore. 

This means that the Discoms should get '14,500 crore from the irrigation and agriculture departments. To meet the additional expenditure, Discoms have proposed a tariff hike for 2018-19 financial year. But the Chief Minister has not agreed. He has assured the Discoms that the government will allocate funds for paying the power tariff in the irrigation and agriculture departments. But these funds are also collected from the people in several ways by the government departments. The CM told power officials that the government is prepared to spend '10,000 crore for lift irrigation and '6,000 crore to '7,000 crore for free power supply to farmers. If the government departments do not pay power charges regularly to the Discoms, the Discoms will collapse. At present, Discoms have to get about '14,000 crore from the state government and its departments. 

The state government is giving a subsidy to the Discoms of about '4,700 crore in the current financial year. But in future, the subsidy burden will increase further. Power officials agree that they are getting the power subsidy from TS without any delay. They hope that in future the CM will ensure that the power charges are paid by the irrigation and agriculture departments.

“Unless the CM is involved it is very difficult to get power charges from government departments. We have confidence in the CM that there will be no problem from the irrigation and agriculture departments in paying power charges,” said a senior official of the power department.

Gram Panchayats owe Rs 3,200 cr since 2014
The Central government’s decision to directly release funds to local bodies could lead to accumulation of arrears to Discoms by local bodies. 

In the past, the Central government released local bodies’ funds to the state government. The state government after deducting power charges released the remaining funds to the local bodies. 

In this system Discoms were paid power charges towards consumption of power by local bodies for street lights. But after the Central government changed the system, Discoms have a problem getting power charges from local bodies.  In TS there are 73 urban local bodies and about 8,684 gram panchayats. Discoms have no issues with municipal corporations and municipalities. The main problem is with gram panchayats. 

A senior official of the power department said that the gram panchayats are utilising all the funds for development activities without paying power charges to Discoms. 

He said that Discoms have to recover power dues of '3,200 crore since 2014 from gram panchayats. Some municipalities too are in arrears.