State power boards forcing Rlys to pay extra for electricity

To make things worse, many SEBs have not paid the railways for the coal consignments transported for them. Power houses owe railways a total of Rs 1,865 crore. He said that though the Cabinet had taken a decision in 1996, to enforce the condition of pre-payment for coal booked by thermal plants, the outstanding amount had still kept mounting.

Officials said that the SEBs took advantage of the fact that railways had to use electricity, at any cost. The railways carried almost 60 per cent of their freight traffic on electric traction, and were paying the SEBs ‘‘unreasonably high tariffs’’ since they had no other option.

The serious blow, of mounting electricity charges, to the financial health of railways had forced them to think of setting up their own generating plant. The proposal has already been made and is in the final stages of approval. The Minister stated that instead of overcharging, the SEBs should be giving rebates to railways for being bulk users and good paymasters.

As per a study conducted by Asian Institute of Transport Development, railways were four-eight times more efficient in carrying freight traffic as compared to roads. However, the advantage was nullified by the ‘‘disproportionately high electricity tariff.’’

He said the railways was not only paying high rates for electricity but also for High Speed Diesel (HSD) oil. ‘‘A break-up of price paid by railways for HSD oil indicate that out of every rupee spent on fuel, only 48 paise is the value of oil.’’ The remaining 52 paise comprising various taxes — customs, sales tax, freight and other taxes. In addition, some states also impose hefty entry tax on inter-state movement of HSD oil.