The Hindu Business Line : Free power to farmers — Maharashtra Govt pays Rs 403 cr to MSEB

The State Government paid the quarterly electricity bill of over 23 lakh farmers when it issued a cheque worth Rs 403 crore to Maharashtra State Electricity Board on Saturday, 10 days ahead of State elections.

The State Government paid up Rs 395 crore to MSEB and another Rs 8 crore to the Mula-Pavara Electric Co-operative Society that supplies power to farmers in Ahmednagar district, towards bills for the July-September quarter, an MSEB spokesperson said.

The Maharashtra Electricity Regulatory Commission had last week asked the State Government to pay farmers' bills in cash before the cash-strapped MSEB sent out its `zero' bills to indicate that farmers would not have to pay for the power supplied to them.

The State Government usually settles payments due to MSEB against cash receivable from the board in the form of various duties.

The payments will help the cash-strapped MSEB as the earlier mode of settlement meant very little money came its way after accounts were settled at the end of the year, said a senior MSEB official.

MSEB had told MERC that the amount receivable from the State Government is about Rs 599 crore, which includes Rs 395 crore as a compensation for the current quarter and Rs 128 crore the losses it will incur by the State's decision to offer concessions to powerloom owners in the State.

The MERC had last week warned that the State's failure to pay the amount in advance would be a clear violation of the provisions of the Electricity Act, 2004.

In July, the Government had announced the free power sop to lighten the financial load on farmers in a year when rains seemed to be failing.

This had evoked opposition from consumer bodies and criticism from experts, who believed that only rich farmers would benefit from the move.

"Most of the Rs 403-crore paid comprises horsepower tariff or bills of farmers who can afford water pumps on their farms. The Government already subsidises farmers' bills. Agricultural consumption of power in Maharashtra is not metred, making it impossible for MSEB to segregate legitimate consumption, based on a flat rate, from technical losses and theft," the official said.