In a significant move, which may go a long way in improving the financial health of the State electricity supply companies (Escoms), the Karnataka State Electricity Regulatory Commission (KERC) has decided to regulate and monitor the periodical and mandatory release of power subsidy to distribution companies. This is being done to discipline the government as the inordinate delay in releasing subsidy would have an adverse impact on the Escoms, directly affecting the consumers.

Disclosing this to media persons here on Monday KERC Chairman K P Pandey said the Commission would shortly issue orders to the government on the timely release of subsidy to Escoms. As per the new provisions the government will have to release subsidy in the first month of every quarter.

“If the government fails to release subsidy in the months of April, July, October and January the Escoms will have to bill the subsidised installations as per the tariff order of the Commission.” This means if there is any delay on the part of the government in releasing subsidy the Escoms will be empowered to bill and collect the money as per the tariff rates from the Bhagya Jyothi and Kuteer Jyothi installations directly affecting the deprived and marginalised sections.

Pandey pointed out that the state government owed a whopping Rs 2,700 crore as subsidy to the five Escoms and due to the delay the Escoms have been facing hardships. “The five Escoms have already collected surplus amount of Rs 1,632 crore from consumers from the year 2003-04 to 2006-07 excluding the 2005 tariff order under challenge in the Energy Appellate Tribunal and if the government released the withheld subsidy Rs 2,700 crore the Escoms will be surplus with Rs 1,132 crore,’’ Pandey said. He pointed out that although the Escoms have collected Rs 1632 crore surplus money from consumers, the KERC has taken a lenient view by asking the Escoms in its latest order to return the benefit to consumers spread over three years.

“In fact all the Escoms have surplus funds. But it’s only a book adjustment. In reality they don’t have cash in hands due to erratic release of subsidy to them,’’ Pandey said.

T&D loss
Replying to a question on the transmission and distribution loss of Escoms Pandey said Mangalore Company (Mescom) stood first in the minimum T&D loss of 15 per cent whereas Gescom had a high 27 per cent. “The international standard is 12 to 13 per cent. But in India it is very difficult to achieve,’’ he added.

 When pointed out about the BJP’s promise of providing free power supply to farm sector the KERC Chairman said: “Let them supply free power to all. We don’t have any objection as long as government makes it up to Escoms. But it will run contrary to public interest as the government would be starved of funds to education, health, social welfare and other sectors.” Pandey lashed out at the state government for continuing its stronghold over the Escoms through the KPTCL.