Merge PSPCL and PSTCL and save Rs 300 cr annually-PSEBEA to Punjab government

Merge PSPCL and PSTCL and save Rs 300 cr annually-PSEBEA to Punjab government

Kanwar Inder Singh/ royalpatiala.in News/ August 12,2023

Punjab state electricity board engineers association (PSEBEA) has once again raised the issue of merger of two power corporations PSPCL and PSTCL with the state government, with an assurance for better power quality and reduction in cost of power.

The association has writen a letter to the new state chief secretary, reminding him about their meeting dated 27 July 2023 held with him wherein the Association has suggested that PSPCL and PSTCL should be merged as a single entity for better efficiency, reduction in the cost of business, improvement in the quality of power and improved consumer services and only the State Load Dispatch Centre needs to be separated out as a different accounting entity.

PSEB (Punjab State Electricity Board) was bifurcated into two Corporations namely PSPCL and PSTCL w.e.f. 16^th April 2010 which was claimed to be made in compliance with the provisions of the Electricity Act 2003. After bifurcation the transmission system above 66 kV i.e. 132 kV, 220 kV, 400 kV is being handled by PSTCL and the Distribution network including 66 kV voltage level along with the Generating Stations is being managed by PSPCL. The argued that as per clause 31 of the Indian Electricity Act 2003 states that State Load Dispatch Centre was to be established by the State Government by its act and until such act was notified, the State Transmission Utility was to operate the State Load Despatch Centre. It was due to a misinterpretation of this clause 31 that PSEB was bifurcated into PSPCL and PSTCL. However, it is worth mentioning that nothing in the Act states that Transmission and Distribution/ Generation shall be separated. The only condition in the Electricity Act 2003 is that SLDC function shall be independent. It is noteworthy that in the states of Himachal Pradesh and Kerala, Transmission, Generation and Distribution organisations are with one company only and this company is performing exceptionally well.

PSEB Engineers’ Association general secretary Ajaypal Singh atwal said” this has always kept the issues of the State and Electricity sector in the forefront and the prime focus for the suggestion for the unification/ merger of PSPCL and PSTCL as a single corporation is the best interest of the people of Punjab & the Power sector and integral with the goals of State Government to ensure reliable, cost effective power for the State.”

He added that the following are the few advantages for the merger of the two corporations:

Planning and Execution of Transmission Works: The foremost issue being faced is the planning and execution of Transmission/ Sub-transmission works. With the changing Power scenario and shift of emphasis from energy surplus to sustainable energy and thrust of renewable sources of power, the utmost requirement is reliable and adequate interstate and intra state transmission capacity. In the past, it has been seen that due to the bifurcation of the corporations, there is a serious lack of coordination and synergy in the planning and execution of works as the transmission corporation is unable to foresee the load growth which comes in the purview of Distribution licensee. As a consequence the consumers of the state (mainly industrial) have to wait long for their electricity connections and enhancement in industrial loads, negatively impacting the state industrial policy. Currently, many industrial connections are pending due to these coordination issues. By merging both the organisations and holistic planning in accordance with the load growth pattern, advanced planning and strengthening of works can be done to match with the demand.

Delays in Restoring Power Supply: Issues relating to the restoration of supply arise with the 66 kV and 11 kV feeders emanating from PSTCL stations, due to differences in instructions issued to the field staff by controlling officers of the respective organisations. In the majority of cases, due to multiplicity of Jurisdiction/ change of command, even routine technical decisions required for restoring power supply are taking excessive time thereby delaying the restoration of power and thus affecting the esteemed citizens of the Punjab State.

No Clear Demarcation of the Jurisdiction: There is no clear demarcation of the jurisdiction of the two organisations as 66kV and 11kV levels are also managed by PSTCL at many stations. PSTCL is always in denying mode to maintain existing 11KV Breakers in 220kV/ 132kV substations and also denies installation of 11KV breakers at existing 220kV/ 132kV substations as it is not the primary business of PSTCL to maintain 11kV breakers, thus affecting the quality of power supplied to the consumers.

Excessive Costs While Upgrading Substations: During a meeting of Chairmen of both corporations held in 2022 it was decided that in case of upgradation of substation from 66KV to 220 KV level, the existing 66KV substation along with its assets and manpower shall be taken over by PSTCL to avoid the O&M cost of maintaining separate substations by PSTCL and PSPCL at the same location; there are still many such cases where the same is not being followed till date thereby unnecessarily increasing the cost. All such problems of coordination shall be resolved with the merger of the two corporations.

Duplicity of posts of officers/officials at various levels exists due to which the manpower is not distributed rationally. A brief overview is produced as under, which clearly depicts this contention:

By rationally distributing the above posts, higher efficiency, coordination and effectiveness can be achieved.

Atwal adding further said “as brought out above, due to overlapping of voltage level in both the Corporations, offices of the respective corporations often procure similar/ same equipment and thus due to the quantity differential fail to realise optimum price, which in many cases result in delays to the project execution. Further, each corporation has to separately maintain minimum stock inventory meaning unnecessary additional cost.Intercompany transactions are subjected to statutory taxes like GST etc, which is a direct financial loss to the companies and can be avoided by the merger.”

Highlighting the benefits of merger, the spokesperson of the association said “it is also worthwhile to mention that whereas PSTCL has paid income tax on profit but PSPCL had to show losses, ironically the cost of both companies is being borne by the people of Punjab.Due to lack of coordination between PSPCL and PSTCL the issue of mismatch of SEM and SCADA real time data took considerable time to resolve and PSPCL had to pay almost 100 Cr per year for UI charges, which was an avoidable loss.With the merger of the two organisations and rationally unifying the common functions being performed by different offices the quality of power will improve and the state industrial policy will benefit. This will also save significant cost on account of similar functions being performed by both the companies.”

Jasvir Singh Dhiman, president PSEBEA said “with policy unification, new initiatives such as the installation of EV charging stations and Solar panel installation at Grid substation buildings etc. will get a substantial impetus.The merger will widen the scope of the working of Power Engineers who will get to work in all three wings namely Generation, operation and transmission of the Power sector. With the merger of both entities there is a potential of saving about 300 Cr annually.”

He added that the “government  will appreciate that if these two corporations are merged inline with the model adopted by the Kerala Government, people of Punjab stand to gain immensely in terms of better power quality, timely release of industrial connections and reduction in cost of power, which will eventually be passed on to the people of Punjab.”