The AAP government has completed a month in Punjab. The party is commemorating the day by announcing, one of its election promises, the Bhagwant Mann government has announced 300 units of free power to every household. The scheme will be implemented from July 1.
Punjab chief minister Bhagwant Mann has been building up for this announcement from Tuesday onwards. Mann on Tuesday said he will soon give a “good news” to the people of the state.
The scheme seems to be the extended version of the scheme that is prevalent in Delhi. The party’s national convenor and Delhi chief minister Arvind Kejriwal had announced the scheme last year at the beginning of the campaigning for elections, making it one of the poignant issues in Punjab.
The Punjab State Power Corporation Limited provides electricity to 73.80 lakh households. As per the data, the power consumption observed in the past billing cycles points out that around 62.25 lakh consume less than 300 units. This means more than 80 per cent of the consumers will not be required to pay the bills, and have the direct benefit of the scheme.
The PSPCL data indicates that the consumption of power fluctuates according to the weather. In summers there is an increase in consumption and in winters the power consumption decreases. The data collected over time is used to calculate the average that shows the maximum number of households in a billing cycle that consumed power up to 300 units reached 69.31 lakh and a minimum of 51.23 lakh. Hence, the average was calculated at 62.25 lakh.
Similarly, there was a maximum of 22.57 lakh households using more than 300 units per month in a billing cycle, and a minimum of 4.49 lakh, which indicates an average of 11.55 lakh.
The average consumption was 137 units per month in the category of up to 300 units, as per the PSPCL’s data.
Electricity and its consumption have been a hot topic during the elections with every party trying to woo the voters with subsidies. However, there are existing subsidies that cost 3.998 crores per annum to the government. A chunk of Rs 1,657 crore is for SC/BC/BPL consumers, numbering 21.83 lakh. According to the existing scheme, the first 200 units per month are free for people belonging to this category. The other Rs 2,341 crore subsidy is provided to 64.46 lakh domestic consumers having load up to 7 KW.
To win the race in Punjab, the previous Charanjit Singh Channi government had slashed power bills by Rs 3 per unit in various slabs for these consumers from November 1, 2021. AAP government had carried forward this subsidy.
The existing subsidies and the announcement made today add up to a power subsidy of Rs 5,500 crore to be taken care of by the Punjab government. If todays’ announcement is singled out, it will add a subsidy burden of around Rs 1,502 crore.
Meanwhile, the PSPCL talks about the probability of a shift in behaviours in the consumer due to this subsidy. According to the officials, it is likely that consumers who had been using 150 units per month, will now consume up to 300 units because it is free. Also, joint families may get their metres split to benefit from this scheme. In addition, many others consuming a little above 300 units per month may reduce their consumption to fall in this bracket.
According to PSPCL’s calculations given to the Indian Express, if all consumers use the entire 300 units of free power at a rate of Rs 5.11 per unit, the total subsidy outlay would increase to Rs 11,452 crore per annum, in addition to fixed charges of Rs 459 core. As such, the total would amount to Rs 11,911 crore each year. For the approximate 11.55 lakh consumers who use more than 300 units of power, the yearly subsidy outlay amounts to Rs 2,427 crore, including fixed charges of Rs 302 crore. The estimated annual subsidy outlay for both categories (about 73.80 lakh consumers) would increase to Rs 14,337 crore.
When asked how this whopping amount is going to be addressed by the AAP government. The party’s spokesperson Malwinder Singh Kang said the government’s income from excise and mining is likely to increase considerably in the coming months. He said that with the end of ‘inspector raj’, even tax collection will increase, he added. According to him then this money will be further used to fulfil the promises made by AAP.
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