Madhya Pradesh government waives power bills of 71L consumers

Bhopal: The benevolence of the state government in waiving power bills for a huge chunk of ‘poor’ consumers is likely to backfire on remaining consumers in the form of higher power tariff.

This is how it happened: Till date, the government has waived pending electricity bills worth Rs1406 crore of 47 lakh consumers of the three discoms under its flagship scheme “Sambal”. Along with this, 24 lakh residents have registered (mostly existing electricity consumers) for the “SARAL” scheme of the state government to avail electricity on flat tariff of Rs200 per month.

The three discoms have around 1.1 crore domestic consumers on which these two schemes are based. In this scenario, 71 lakh out of 1.1 crore consumers have registered for these two schemes. It is worth noting that the government is also waiving electricity bills in cases of power theft.

The amount of waived bill is expected to cross the mark of Rs5, 128 crore as estimated by the Madhya Pradesh Power Management Company (MPPMC).

What would be the impact?

Experts said the policy of the state government to waive off power bills would only end up creating extra load on the power distribution companies that have already failed to recover existing dues.

Of the estimated Rs5,128 crore, the government will compensate Rs1,800 crore where surcharge will be waived. Of the remaining Rs3,328 crores, Rs1,800 crore will be just “written off” from the receivable amount of the discoms and the rest will be borne by the distribution companies.

The amount which would be “written off” from the account books would reflect in books of the three discoms as bad debts and when the companies will come up with a fresh true-up (tariff) petition before the Madhya Pradesh electricity regulatory commission (MPERC), the regulator will have to hike the tariff in cognizance of bad debts – to be paid by remaining consumers.

No budget for waiver

The government made no budget provisions for the subsidy of the bill waiver scheme whereas according to The Electricity Act-2003, the subsidy should be provided in advance. It is most likely that the government would only provide subsidy after the election. The extra load on discoms would only reflect on accounts leading to certain major hike in electricity tariff in 2019-20 -Rajendra Agrawal, retired additional chief engineer, state electricity board

Will recover revenue

The government is doing whatever possible for the residents. We will recover with increasing consumer base under SARAL and SAUBHAGYA scheme -ICP Keshari, principal secretary, energy department