Kerala Braces Up For Another Power Tariff Hike

Kochi: | Updated: Aug 26 2002, 05:30am hrs
Its a high voltage duel in Kerala between the power and industry ministers. The former is arguing for a power tariff hike and the latter feels that such a hike will hit industry hard, especially at a time when the government is on a path to make Kerala a safe destination for industries. But in this duel it is the ordinary consumer who is getting hit.

With 19 hydel projects, two thermal projects of the Kerala State Electricity Board (KSEB) and NTPC and BSES Kerala power projects, Kerala produced 2,345 mw when the capacity was 2,933 mw. Of this, 1,460 mw was hydel power, 499 mw came from thermal plants and rest from the central pool, according to the figures with the board as on Jan 02.

It seems a paradox that when hydel power is the cheapest, the board is suffering a big loss. Besides the high cost of power from the two naphtha-run thermal plants, it is mismanagement and theft that has landed the board in such a situation. No tariff hike can save it, say experts.

According to the power minister, the monthly loss incurred by KSEB is Rs 100 crore. As per official figures, the transmission loss annually is estimated at 17.5 per cent. If the board succeeds in reducing this by 5 per cent, the loss can be reduced by Rs 400 crore. Power theft, if reduced by an equal percentage, would mean an additional revenue of Rs 400 crore, thus bringing down the loss from an annual Rs 1,200 crore to just Rs 400 crore.

There has been some making up in the boards accounts as per which it had a profit of Rs 64.53 crore during the last fiscal against Rs 56.72 crore the previous year. This has been calculated taking into account over Rs 4,000 crore due from government departments. In the case of a domestic consumer fleeced by the board, a delay in payment by a few days would mean a fine and after that disconnection.

When the board earns Rs 215 crore a month, the expenses incurred is Rs 290 crore of which Rs 157 crore is merely for purchasing fuel and power from the thermal stations.

Kerala had been depending mainly on hydel power. Till the mid-80s, the hydel-thermal ratio was 80:20. By the turn of that decade, it was 50:50 and remains so. With the failure of the monsoon, KSEB would need to find an additional Rs 80 crore for thermal power. There are over 20 hydel projects yet to be completed. A classic case is that of the Vagamon diversion project where tunnel excavation started from both the ends which never met. The project was ultimately dropped.

This is the second time in the 14 months after this government came to power that there will be a tariff hike. The refrain is that KSEB has been suffering heavy losses. Incidentally, the last time tariff was increased from Rs 1.89 per unit on an average to Rs 2.30, besides the hike in meter charges, the loss remained unaffected.