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As PSERC cuts domestic power tariff 2nd Year in a row, Punjab CM says poor consumers will be benefitted amid Covid

Punjab Chief Minister Captain Amarinder Singh on Friday said the massive cut, ranging from 50 paise to Rs 1 per unit, in domestic power tariff will provide major relief to domestic consumers, especially the poor, who are already reeling under financial problems due to the Covid pandemic.

This is the second year in a row that the power tariff for domestic consumption in the state has been reduced. Domestic power rates had been cut down by 50 paise per unit by the regulator in 2020 too.

While pointing out that the decision of the Punjab State Electricity Regulatory Commission (PSERC) to reduce the domestic tariff would bring relief to the tune of Rs.682 Crore for 69 lakh domestic consumers in the state, the Chief Minister also hailed the decision of the regulator not to increase tariff for commercial consumers as well as small and medium industry amid the Covid pandemic. Even the hike in tariff for industrial users was quite marginal, he pointed out, adding that this would also come as a relief to industry, which had also been severely impacted by the lockdowns and demand crisis as a result of the unprecedented contagion outbreak.

The industry has been getting power subsidy from the state government since 2017, when the tariff was reduced to Rs. 5 per unit as variable cost. Soon after coming to power, the Captain Amarinder Singh government, in line with its poll promise, had announced its decision to subsidize power for the industry. The government has given a total industrial power subsidy of Rs 4911 crore during 2017-21, with the same being availed by around 42,000 Medium and Large Industrial consumers, along with 1,04,000 Small Industrial consumers. The subsidy provide to industry by the state government for FY2021-22 will be to the tune of Rs 1900 crore.

Reiterating his government’s commitment, as listed in the Punjab Congress 2017 election manifesto, to provide continuous supply of affordable power to all sections of the Indian economy, including domestic consumers, trade, business and industry, the Chief Minister expressed the hope that the rates would be further rationalized going forward. His government had, in fact, recommended more reduction in tariff this year too, not just for the domestic consumers but also for industry, he added.

Captain Amarinder said despite the revenue shortfall in the state exchequer due to the Covid crisis, his government was committed to continue giving free power to the farmers and subsidized power to the industry. His government will also continue to subsidize SC, BC and BPL domestic consumers with 200 free units per month, and Freedom Fighters with 300 units per month for domestic consumption, he added.

In fact, said the Chief Minister, following the reduction in fixed charges by 40%, his government will also now bear the costs – to the tune of Rs 96 crore, resulting from the reduction. This would help provide relief to the Medium Supply (MS) industrial consumers, who are already grappling with the financial crisis resulting from the pandemic.

Lauding PSERC for diligently managing the rationalization of domestic tariff, the Chief Minister said the regulator had judiciously purchased power at competitive rates and had been able to reduce interest charges on account of loans. He pointed out that the reduction in domestic tariff for load upto 2 KW (Rs.1.00 per unit and 50 paise per unit for consumption slabs of 0 to 100 units and 101 to 300 units respectively) and 2 KW – 7 KW (75 paise per unit and 50 paise per unit for consumption slabs of 0 to 100 units and 101 to 300 units respectively) works out to 22.30% cut in tariff for the first slab upto 2 KW load. This would naturally benefit the poor and vulnerable sections, who were the worst hit by the pandemic, the most, he added.

The Chief Minister also hailed the PSERC decision not to hike the power tariff in the prevailing situation, when shopkeepers in the NRS category had been badly impacted by the lockdown. The same was the case for Small Power (SP) and Medium Supply (MS) categories of industrial consumers, he noted.

The PSERC’s decision to continue with the special night tariff with 50% fixed charges and energy charges of Rs.4.86/Kvah for Large Supply (LS)/Medium Supply (MS)/Small Power (SP) industrial consumers using electricity exclusively during the hours of 10:00 PM to 06:00 AM was also welcome, said the Chief Minister. This, he said, would help the small units overcome some of the economic losses suffered due to the lockdown.

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