The Hindu : Tariff revision inevitable: Kadavoor

Online edition of India's National Newspaper
Monday, May 20, 2002

Southern States

Southern States - Kerala

Tariff revision inevitable: Kadavoor

By Our Special Correspondent

THIRUVANANTHAPURAM MAY 19. The KSEB's slide into the depths of a financial disaster has been arrested through a series of measures adopted during the last six months, according to the Electricity Minister, Kadavoor Sivadasan.

At a press conference here today, he stated that the inevitability of another tariff revision was still there.

This would be done on the basis of the recommendation of the Electricity Tariff Regulatory Commission to be constituted shortly.

He said that, when the UDF assumed charge a year ago, the annual gap between the KSEB's revenues and expenditures was in the region of Rs. 1,925 crores. The debts came to Rs. 4,436 crores and the other liabilities, Rs. 2,000 crores.

The challenge before the Government was how to reverse the KSEB's steady slide into a financial disaster.

He said the willingness Tamil Nadu and Karnataka had shown last week to draw 180 MW of electricity from the Kayamkulam station of the NTPC had come as a big relief to the KSEB.

This gesture of the neighbouring States alone would help the KSEB save Rs. 150 crores annually by way of fixed charges on the Kayamkulam power.

He said the Union Minister for Power, Suresh Prabhu, had a key role in getting Tamil Nadu and Karnataka agreed to Kerala's request for sharing the high-cost power generated at the National Thermal Power Corporation's (NTPC) Kayamkulam station, which was fully dedicated to Kerala. "This sharing is on the basis of a contract with the other two States. It does not mean Kerala is relinquishing its right over the entire power generated at Kayamkulam. The contract will help bring down the KSEB's financial burden till the overall situation improves,'' he said.

Mr. Sivadasan said that during his visit to New Delhi last week, the Centre had agreed to extend excise duty concession on naphtha used as fuel at the Kayamkulam NTPC station.

This concession was accorded to all other naphtha-based thermal power stations in the country wishing to shift to natural gas when it became available. The Kayamkulam station was, however, excluded from the list. The KSEB would save Rs. 40 crores a year on power purchase due to this excise duty concession.

Mr. Sivadasan said the KSEB was also confident of saving around Rs. 100 crores annually through austerity measures already put in place and Rs. 120 crores through the ongoing drive against power theft.

The total savings expected from all these developments, including the deal to surrender half the power generated at the Kayamkulam NTPC station and the Centre's promise to extend excise duty exemption for naphtha used at Kayamkulam, would be in the range of Rs. 410 crores, he said.

He said never before in the history of the KSEB had there been even an attempt to check extravagance.

For instance, the KSEB employees had all along been drawing eight days' wages for working six days a week. The system of lavishing `holiday wages' on the employees entailed a yearly expense of Rs. 13 crores to the KSEB. This system was stopped six months ago.

By restricting the telephone charges for all officers down from the level of chief engineers and withdrawing phone connections extended to officers whose functions did not call for such facility, the KSEB would be saving substantially. There had been no limit to phone charge reimbursement to the KSEB officers in the past.

Mr. Sivadasan said that, one by one, the sources of revenue leak had been plugged.

The transmission and distribution loss for the KSEB came to 35 per cent now.

The KSEB chairman, T. M. Manoharan, was also present at the press conference.

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