Power companies eat up PSUs' profit in Chhattisgarh

Two state-owned power firms incur combined losses exceeding Rs 1,300 crore, pulling into the red, the overall performance of PSUs in the state

Heavy losses incurred by state-run power companies in Chhattisgarh have impacted the performance of the state’s public sector undertakings (PSUs) in general.

In Chhattisgarh, there are 21 registered PSUs including 20 companies and one statutory corporation (all working). None of them has been listed on the stock exchanges. The working PSUs posted a turnover of Rs 15,510.96 crore as per the latest finalised accounts. The turnover was equal to 7.38 per cent of the state gross domestic product (GDP) for 2014-15.

As per the latest finalised accounts of September 30, 2015, underlined in the Comptroller and Auditor General (CAG) report, 12 PSUs had earned profit of Rs 111.55 crore while six incurred a combined loss of Rs 1,344.19 crore that had resulted in working PSUs loss in the state to the tune of Rs 1,232.64 crore. The accounts of remaining PSUs were not finalised.

The accumulated loss figure was mainly due to the losses incurred by Chhattisgarh State Power Distribution Company Limited (CSPDCL) and Chhattisgarh State Power Generation Company Limited (CSPGCL). While CSPDCL booked a loss of Rs 630.42 crore, CSPGCL incurred a loss of 683.96 crore in 2014-15, according to the latest accounts. The loans outstanding against CSPDCL and CSPGCL were Rs 1,540.10 crore and Rs 9,677.58 crore respectively.

During the past five years, investment in the PSUs has grown by as much as 182.70 per cent from Rs 9,178.35 crore to Rs 25,947 crore. In 2010-11 and 2011-12, the PSUs had registered profit of Rs 315.59 crore and Rs 309.44 crore respectively. However, they slipped into red from 2012-13 on incurring a loss of Rs 1,876.98 crore. The loss was reduced to Rs 420.14 crore in 2013-14.

“Why the power distribution company is incurring a loss is a matter of high level probe,” said T T John, Convenor of Chhattisgarh Electricity Board Employees’ Union. The number of consumers had increased while the power tariff was also raised, and power infrastructure had also strengthened he said, adding that there was no reason for the distribution company to bear the loss. John said that the loss of the generation company could be justifiable as the plants were decades old and there were issues related to raw material.

The power company officials did not respond to the queries sent by Business Standard for their version on the issue.