4 min readChandigarhJan 21, 2010 12:59 AM IST
First published on: Jan 21, 2010 at 12:59 AM IST
PSEB will get 18 pc of power bills from farmers,82 pc from govt
While trying to bridge the rural-urban divide between the ruling allies,the two-member committee of Deputy Chief Minister Sukhbir Badal and Industries Minister Manoranjan Kalia has proposed widening of tax net on the urban sector — BJP’s core constituency — but not without hitting at the votebank of Akali Dal too.
Though sugarcoated as productivity bonus that is to be paid to farmers during rabi and kharif seasons,the formula of charging farmers Rs 50 per brake horse power (bhp) is clearly an indication that farmers will have to pay for the power they use.
“The rate calculated for the 2009-10 tariff order by the Punjab State Electricity Regulatory Commission (PSERC) for agricultural pumpsets category is Rs 283 per bhp per month. By charging farmers at the rate of Rs 50 per bhp — though still highly subsidised — the state will now pay only Rs 233 per bhp to the Punjab State Electricity Board (PSEB),which works out to be 82 per cent. The remaining 18 per cent will come from the farmers,who in turn will be reimbursed by the state. While it is just jugglery of funds for the government,as it has still to pay the same amount of subsidy,for the PSEB it means it can recover at least 18 per cent of its dues from farmers. However,the big question is whether the farmers will pay to the PSEB and whether the government,which has been consistently defaulting on payment of power subsidy to the board,will have the money to reimburse farmers,” says former PSEB advisor Padamjit Singh.
This partial withdrawal of subsidies has been proposed by the Sukhbir-Kalia committee as a requirement to avail of funds from international bodies,such as World Bank,and help farmers get a higher minimum support price (MSP) for crops,as free power is not factored in as input cost by the Agricultural Costs and Prices Commission (ACPC).
But what it does not reveal is that it was also a political and economic compulsion. “The government clearly knows that the state has reached a point where it cannot afford to foot huge subsidies. The productivity bonus is only to make the farmers start paying. There will never be money to reimburse lakhs of farmers on the basis of their power usage. The idea is not practical,” said a source in the finance department.
The panel’s recommendation of charging Rs 50 per bhp is just to recover part of the power bill from farmers and is not likely to impact the agricultural consumption figure and transmission and distribution (T&D) losses shown by the power board.
“Since nearly 93 per cent of the total nearly 11 lakh tubewells in the state are not metered,the farmers are charged on the basis of tubewell load rather than meter readings. Therefore,agricultural consumption of power remains the most contentious issue between the PSEB and the regulatory commission. The PSEB projects its free power figures based on sample meters that cover just seven per cent of the total number of tubewells in the state. The regulator has been asking the board to take the sample size to at least 10 per cent. Since PSEB’s projections on free power directly impact the T&D losses,the board’s figure was slashed by 10 per cent in its 2009-10 tariff petition after a survey done by an independent agency,” adds Singh.
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