PSPCL suffered Rs 1,741 cr loss: Study

Because of "ineffective planning" for power purchase, power utility Punjab State Power Corporation Ltd (PSPCL) suffered financial loss to the tune of Rs 1,741.82 crore during 2010-13, as per study.
The financial loss was suffered while purchasing short term power, energy banking and unscheduled interchange (UI) transactions, said the study which was submitted to PSERC.
The power regulator Punjab Electricity Regulatory Commission (PSERC) roped in Mumbai based ABPS Infrastructure Advisory Private to carry out a study on power purchase, sales, surrender of power along withdrawal, sales under Unscheduled Interchange for PSPCL for the period of April 1, 2010 to March 31, 2013.

The study blamed the PSPCL for variations in power purchase quantum as compared to approved by PSERC, saying that power purchase by power utility was in not in accordance with the actual progress of new power generating projects.
"The delay in commissioning of new generating stations and failure to accurately assess the availability of power from these stations led to increase in short term power purchase and resulted into a financial implication of Rs 745.62 crore in 2010-11, Rs 229.62 crore in 2011-12 and Rs 491.59 crore in 2012-13 with the cumulative implication of Rs 1,466.83 crore," it said.
The study also highlighted that the actual average rate of power purchase during 2010-11 from other sources was Rs 5.15/ kWh which is considerably higher than the PSERC approved rate of power purchase of Rs 3.12/kWh.

"The reason for higher power purchase cost from other sources is due to the reason that the actual power purchase from the new generating stations was substantially lower than the projected power purchase from new sources and hence PSPCL has to procure power from other sources," it observed.

The study also pointed out that PSPCL had sourced "expensive" power from RLNG and liquid fuel based stations during 2010-11, 2011-12 and 2012-13 whose average variable cost exceeded Rs 8/kWh.
Pointing out failure on the part of PSPCL in maintaining grid discipline, the study said PSPCL incurred additional cost in the form of additional UI charges and interest charges to the tune of Rs 170.92 crore.

As far as energy banking is concerned, the study said that PSPCL committed "outward banking" in months when it actually faced acute shortage of power due to which it had to overdraw from the grid paying UI charges and additional UI charges.
"The total financial impact on account of mis-management in the banking schedules is estimated to be approximately Rs 104.07 crore," it said.
Under energy banking, PSPCL enters into banking arrangements every year to manage its peak demand during the paddy season when demand is high owing to agricultural load.