Karnataka govt spending Rs.1,000 crore a month on buying power

In the vanguard: Minister for Energy Shobha Karandlaje flagging off Bescom maintenance vans in Bangalore on Monday. DH Photo

The Government is spending Rs 1,000 crore a month on buying power from other States and private generators, draining the State coffers.

The bill for power import between April and November 2010 was a jaw-dropping Rs 8,633.99 crore, and an estimated Rs 4,430.48 crore more will be spent between December, 2010 and March 2011 to cope with the crisis and ensure ‘proper’ supply to the consumers.

Simply put, the power utilities are spending Rs 36.19 crore a day for buying power. Among five electricity supply companies (escoms), Bescom is the biggest buyer, spending Rs 20 crore a day. The lowest is Mescom, which purchases power worth Rs 3.16 crore a day.

The information was provided by Energy Minister Shobha Karandlaje to the Legislative Council on Monday, in reply to an unstarred question by Basavaraj Horatti.

The Minister made it amply clear that the consumers will have to pay for the cost of the power purchased, stating “electricity supply companies (escoms) will bear the cost of power purchase using their own resources and that they will make good the entire cost through tariff collection.”

All the five escoms, have already purchased power worth over Rs 5,000 crore over the previous two years. The amount spent between April and November 2010 and planned to be spent between December 2010 and March 11, together will be over Rs 18,000 crore.

Of the sum, the Government will reimburse only about Rs 3,618 crore spent towards supplying power to IP sets, Bhagyajyoti and Kutirajyoti beneficiaries, the Minister stated in her reply.

Although the escoms have no plans to seek tariff revision at present, they will have to file a petition before the Karnataka Electricity Regularity Commission in this regard very soon, in order to prevent a financial crisis. The KERC has already hiked the tariff by an average 30 paise per unit last month, citing the escoms’ financial woes.

Purchase agreements

The Government has drawn out a detailed power purchase plan for the coming summer months.

Accordingly, it has already issued letter of intent to escoms to purchase 1,000 MW of power between September 2010 and May 2011 at a cost of Rs 700 crore. Besides, permission has been granted to buy 300 MW of power from PTC India Ltd, Chhattisgarh, between January and April 2011, Karandlaje revealed in reply to a question by Abdul Azim.

As a long term measure, the government has decided to purchase 1,580 MW of power for 25 years starting from July 2014, she added.

Replying to another question, Karandlaje confirmed that the government planned to install meters to IP sets, adding that the plan depended on the cooperation of the farmers.

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