Induction furnaces asked to shut down in Punjab

Even after the summer months are gone, Punjab is in a precarious power situation.

Against the total demand of power of 1,650 units per day, the Punjab State Electricity Board has been able to supply only 1,200 units.

The impending elections and political compulsions make it imperative for the ruling party to continue the free power supply to agriculture. The state buys 25 lakh units at Rs 6 per unit and supplies free to farmers, paying a subsidy of Rs 1,600 crore to the Punjab State Electricity Board in lieu of free power.

On the other hand, most of the industrial units in the state are operating at 20 per cent of capacity due to the power shortage.

While other industrial sectors are still getting power supply for 6-8 hours a day (the requirement is 24 hours), induction furnaces have been ordered to shut down till further orders. There are close to 150 induction furnaces for the steel industry across the state, which have acquired significance in the industrial value chain in Punjab.

The furnaces were closed even from July 6 to July 13 and afterwards they were given power for only three days a week for 11 hours.

Speaking to Business Standard, K K Garg, president of the North India Induction Furnace Association, said induction furnaces bore the brunt each time.

"The indefinite cut on the induction furnace units is affecting other industries as well. Induction furnaces are losing Rs 400 crore daily.

On average about 150 workers work in an induction furnace and if the workers of the 1,500-odd induction furnaces are calculated, the total comes to 22,500. So around 22,500 workers are without work at present," Garg said.

"On the other hand, four arc furnace units, namely, Aarti Steel, Vardhaman Steel and Upper India Steel in Ludhiana, and Modern Steel in Mandi Gobindgarh get 120 hours of power a week.

The fact is that our 150 odd induction furnaces consume 300 MW of power daily, while those 4 induction furnaces consume 200 MW of power daily. Why is the government showing step motherly attitude towards us?"

Interestingly, as per the association members, the ARC induction furnaces make steel, which is going out of the state, while induction furnaces are being used for domestic supplies.

In June, prices of scrap, the raw material in induction furnaces, had dropped a lot following closure orders.