Ujwal Discom Assurance Yojna may not light up Kerala State Electricity Board
Thiruvananthapuram: With the state joining the Union Ministry of Power's UDAY (Ujwal Discom Assurance Yojna) on March 2, under which 75 percent of a distribution company’s liabilities will be wiped off, KSEB Limited should have lost all its arguments for a power tariff hike. However, KSEBL has joined only the operational part of the package, not the financial part. “Our state government, at the moment, does not have the financial muscle to take on KSEB’s debts. The government need not bother either as KSEBL, unlike other discoms (distribution companies) in the country, is bringing down its losses in a phased manner. So we are part of the operational package only and would not gain even a penny from the arrangement,” said N S Pillai, KSEBL’s finance director.
KSEBL has based its plea for a tariff hike on a liability of Rs 7,172 crore it is said to have accumulated during 2011-12 and 2012-13. Being part of UDAY should have meant KSEBL would be freed of 75 percent of this burden, thereby sparing it of the need to up tariffs. On March 2, Kerala became the 27th state to join UDAY when the State Government, KSEBL and the Central Power Ministry signed the tripartite agreement. It also became the only state to stay out of the financial package. The operational part makes it mandatory for KSEBL to bring down aggregate technical and commercial (AT&C) losses by 11 percent in 2017-18, and reduce transmission loss by 4.40 percent in 2017-18.
“This will definitely improve the utility’s efficiency,” Mr Pillai said. Certain operational targets at total electrification and popularizing of LED are already being carried out by KSEBL. Mr Pillai said the only reason the state joined UDAY was to keep the Centre in good humour. “We don’t require benefits promised by UDAY like cheap power as we already bring power at competitive rates,” the finance director said. Nonetheless, Union Power Ministry sources said that KSEBL could gain nearly Rs 4,200 crore by way of cheaper funds from the Centre, reduction in AT&C and transmission losses, and energy efficiency.
