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Punjab industry objects to 55 per cent hike in power tariff

According to reports, Punjab’s industry on Friday opposed the proposal to increase power tariff by 55 per cent and said the hike would be counter-productive.

“The industry will have to be completely shut down if the 55 per cent hike is permitted to be raised in power tariff as it will leave us uncompetitive,” Chairman of Modern Steel Amarjit Goyal said.

Industry representatives asked for containing ballooning power subsidy to farm sector and 100 per cent metering of agricultural power connections.

These points were raised by the industry while filling objections with Punjab State Electricity Regulatory Commission (PSERC) on Annual Revenue Requirement (ARR) petition filed by Punjab State Power Corporation Limited (PSPCL). PSERC invites objections before fixing tariff.

PSPCL in its ARR had said it would require 55 per cent hike in power tariff for containing its revenue gap for year 2012-13. Against the total expenditure of Rs.20,415 crore, it had proposed a revenue gap of Rs.8,983 crore for 2012-13.

“There should not be any hike in power tariff for 2012-13. Instead tariff should be brought down as they are already at high level,” Mr. Goyal said, adding that Punjab’s power tariff was among the highest rates in the country.

The industry is charged Rs.4.47 per unit to Rs.4.95 a unit. Besides, fuel surcharge of 8 paise per unit, 13 per cent electricity duty and 10 paise as octroi are also charged.

However, power to farm sector, Scheduled Castes domestic consumers and non-SC Below Poverty Line consumers is free with the State providing subsidy to the tune of about Rs.4,200 crore per annum.

Describing free power as burden on resources, the industry representatives asked for the 100 per cent metering of farm connections which would keep a check on misuse of power by “unscrupulous” farmers.

They also strongly objected to the proposal of introducing dual tariff for the industrial sector, describing it as move to curtail open access usage by the industry.

Under dual tariff, users will have to pay fixed charges as per routine usage and when the usage exceeds the allocated demand, then further charges will be levied at separate rates.

Industry also sought to lay down a roadmap to eliminate the cross-subsidy with respect to power supply to different consumers as it felt that per unit cross-subsidy on industry was rising every year.

Transmission and Distribution losses which are ruling at higher level of 18 per cent needed to be brought down significantly to improve power supply situation in the State.

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