The State government has announced its willingness to provide necessary financial assistance to the power sector and subsidy to the power utilities in accordance with the provisions under the Section 65 of the Electricity Act, 2003.
The Government, during 2014-15 fiscal, earmarked subsidy of Rs. 3,188 crore for the two utilities, southern and eastern power distribution companies and officials feel that the subsidy sought for the next year is likely to be much higher. This would put the government in a piquant situation it was yet to work out modalities on coming out of the cash crunch it was facing post bifurcation.
“The APERC will arrive at a conclusion on the requirement after the public hearings are completed. The quantum of subsidy will be worked out by the regulator and communication would be sent to the government,” a senior official told The Hindu .
Meanwhile, in a communication to the AP Electricity Regulatory Commission, Energy Secretary Ajay Jain said provision of necessary financial assistance and subsidy would enable the government to ensure quality power supply to all sections and also in extending assistance to BPL consumers and farm sector. The announcement, coming at a time when the regulator is holding public hearings before announcing tariff revision for the year 2015-16, assumes significance as the discoms have projected a revenue deficit of over Rs. 7,700 crore.
Mr. Jain elaborated on the steps initiated by the power utilities in strengthening the transmission and distribution systems to meet additional load growth and improve voltage profiles with an estimated Rs. 1,351 crore. In addition, Case-I bidding process was initiated for procurement of 2,400 MW with APERC approval. The utilities had launched a drive for replacement of incandescent bulbs with energy efficient lighting, while efforts were on to install 50,000 solar pump sets in the next five years.
Officials feel that the subsidy sought for the next fiscal year is likely to be much higher
The quantum of subsidy will be worked out by the APERC after the public hearings are over
