The Hindu Business Line : Karnataka power supply cos may not get higher subsidy support

Sources said that farm demand was currently being served by imposition of unscheduled power cuts in some sectors including domestic and industrial sectors.

Bangalore May 25 Subsidy support to Karnataka's Electricity Supply Companies is unlikely to be raised beyond the budgeted estimates, despite the cost of cross-border purchases.

Fixed subsidy

For the current financial year, the power subsidy fixed has been fixed at Rs 1,800 crore for the five companies. Power purchase costs for this year is estimated at Rs 8,044 crore for 30,783 million units. This figure is based on an average purchase cost of Rs 1.84 per unit for the year.

However, the companies have been forced to make purchases from cross-border sources. This was in view of shortfalls in supplies from generating stations in Karnataka, both hydel and thermal. Sources said that the actual requirement per day was in the State was about 125 million units per day.

However, both the hydel and thermal stations were able to generate, inclusive of supplies from Central generating stations, barely 80 million units.

The shortage was despite the high generation from the Karnataka's own stations. The stations were programmed to generate only 67 milllion units per day for the current year.

However, the shortages was making, the generation was currently 77 million units, largely due to over drawal from hydel stations

Besides, the State was already purchasing electricity from States such as Punjab.

This was largely to meet the farm load.

There are currently about 16 lakh irrigation pumpsets in the State. Specific consumption is estimated around 6,500 units per annum.

Sources said that farm demand was currently being served by imposition of unscheduled power cuts in some sectors including domestic and industrial sectors.

Demand

The sources said that the purchases Punjab since the beginning of this calendar year was equivalent to about 350 million units to meet the deficit.

The purchases were currently being made on a displacement basis. This implied that when the farm load in Punjab increases from next month, Karnataka would have to return an equivalent amount of electricity borrowed from the State.

In the event of non-availability of the energy, Punjab would purchase from any other source, including the power traders, both in the private/public sector, the costs of which would have to be compensated by Karnataka.

The electricity supply companies had resorted to this steps in view of the tight financial limits imposed on them by the State Government.

In fact, for the current year the actually subsidy demand made by the companies is Rs 2,435.51 crore.

Part of the large demand from various sectors was also on account of the high loss figures.

The companies, barring the Bangalore urban region, are yet to contain the high distribution losses.

However, the sources said, that in the event of shortfall in reservoir inflows, the Government would have to foot the bill for Punjab's purchases beginning from June. This is a potential liability that has not been provided in the State Budget.