PATIALA, June 23: An unprecedented financial crisis has paralysed the functioning of the Punjab State Electricity Board (PSEB) with the board management even withholding the payment of salary and arrrears of pay to the board employees.Bills of equipment suppliers worth crores of rupees have piled up and some of these were as old as six months. Because of delay in payments, good quality suppliers were avoiding the PSEB whereas others had hiked their prices to compensate for delay in payments.The main factors responsible for the present financial mess in the board were the decision of the Punjab government to allow free electricity to the agriculture sector without compensating the PSEB in cash for the loss, stone-walling by the government of the PSEB proposals for hiking the power tariffs for other consumers and the failure to take a hard line in the matter of eradication of power theft.According to a spokesman of the PSEB Engineers Association, the association had warned the Punjab government and the board management in June, 1996, when the hike in power tariff was rolled back by more than 50 per cent that it would lead to serious financial crisis in the board. But the repeated warnings by the association went unheeded by the board.The main reason for this financial bankruptcy of the board, he said, was the fact that more than 54 per cent of the electricity available for distribution earned zero revenue for the board.Spokesman said that the latest figures showed that agriculture consumed about 36 per cent and with transmission and distribution losses officially quoted at 18.5 per cent, the total energy with zero revenue came to nearly 54.5 Per cent.The rest of 45.5 per cent did not earn enough to ensure at least three per cent of return as envisaged in Section 59 of the electricity supply Act, 1948. To achieve three per cent rate of return, an average tariff hike of only 67 paise per unit was required and this would fetch an additional revenue of Rs 1250 crore per annum to the PSEB, which was more than the total capital outlay of Rs 789 crore for 1998-99.But the present position was that for the day-to-day functioning of the board, even the revenue collected from the sale of power had not been enough to cover operating cash expenses like purchase of coal, import of energy and payment of salaries, the spokesman of the engineers' association said.The PSEB tarrifs were lower than the tariffs of the Haryana State Electricity Board (HSEB), the spokesman said, adding that in case the PSEB tariffs were brought at par with the HSEB, the board would earn Rs 1800 crore per annum extra which would enable it to function and develop to meet future power requirements and to provide cheap and reliable consumer service.The association has demanded from the Punjab government that the PSEB be compensated in cash for free power supplied to agriculture consumers, tariffs of other categories be increased to the level of the HSEB, and the board must be allowed to be run on purely commercial lines by a team of competent professionals.
