Long-standing dues from escoms crippling KPTCL

The Bangalore Electricity Supply Company (Bescom) has turned out to be the biggest defaulter in paying the KPTCL's transmission charges with the pending payments leading to financial difficulties and putting the officials in both corporations in the spot.

Of the total outstanding dues of Rs 1,448 crore yet to be received by the Karnataka Power Transmission Corporation Limited (KPTCL), Bescom alone owes Rs 1,191 crore as the delay in the reimbursement of subsidy amount has left the supplying company in losses for years.

In November, the KPTCL raised a red flag over the issue with N Manjula, the managing director of the corporation, writing to Bescom about an impending crisis. "As Bescom has not made payments regularly, KPTCL is finding it difficult to pay salaries to the employees, pay interest on its loans and capital/revenue expenditures, forcing us to look for short-term loans. This will affect our credit rating and have a negative impact on our efforts to borrow from banks," she said.

Sources said the KPTCL's present financial position was the result of the delay or non-payment of subsidies announced to various schemes, especially the power subsidy to irrigation pumps.

"Escoms have run out of money as thousands of crores of rupees in subsidies were not given to them on time. This in turn led to the problem of non-payment of transmission fees to the KPTCL. The government has begun making direct payments to the KPTCL to pay for the subsidies. However, some of the legacy payments are pending," he said.

The Karnataka Energy Regulatory Commission (KERC) had also pulled up the KPTCL for the "increasing trend" in dues from Escoms and asked the officials to explain the reasons. In reply, the corporation said, "Even after constant persuasion, the Escoms are not remitting the transmission charges regularly, thus affecting the financial position of KPTCL," it said.

As per the submissions made before the commission, Escoms will now borrow money to pay transmission fee and power purchase costs to avoid a financial crisis in the power sector.