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July, 2006 MOST state electricity boards (SEBs) are in the red. While some have been trifurcated into independent entities handling generation, transmission and distribution of power, some state governments have put off their unbundling. The power crisis has deteriorated in recent times. It has also become costlier. How to streamline SEBs and strengthen them has become a big problem for the planners and policy makers. The first requirement for improving the functioning of SEBs is to ensure uninterrupted supply of power to the people and to reduce unavoidable power cuts. More than the profit — essential for the survival of an organisation and its employees — what matters most is the extent to which an organisation serves the intended purpose. If power is available even at a litter higher cost, people will buy it, though after some resentment. As the Annual Power Surveys have shown, year after year, the demand for power continues to rise. To ensure uninterrupted power supply, SEBs should constitute a high power committee to meet the future rise in demand for power. It may decide on setting up of new power projects in or outside the state, buying power from outside, renovation of existing projects, looking for new avenues such as nuclear or gas power stations etc. Its proposals should be implemented within a specific timeframe. Tariff rationalisation demands reduction in transmission and distribution (T&D) losses, reduction in overhead expenses and lesser cost of generation. These are gradual processes. In Punjab, for instance, power supply is largely dependent on thermal power stations and coal has to be either imported or brought from distant places. Thus, there is no scope for reduction in the cost of generation. The regulatory bodies should ensure that the unit tariff is more than the cost incurred per unit after taking these factors into account. This is essential to ensure the survival of SEBs, the power supplying bodies. True, even a little rise in power tariff evokes protests. However, if power is available, the din dies down. Consider petrol. It has become quite costlier, but the number of vehicles and the consumption of petrol continue to rise. Though higher tariff pinches the people, their first priority is continuous power supply. Cost reduction and tariff rationalisation are secondary to uninterrupted power supply and freedom from power cuts.
In a recent survey by The Tribune, 90 per cent people voted for paying more if uninterrupted power supply is ensured. Herein lies the answer. Uninterrupted power supply needs to be ensured by any means: by installing projects — thermal, nuclear, gas based, diesel operated, hydel or by buying it — at any rate! At the same time, the tariff has to be fixed in a manner that an SEB can make profit after meeting all the expenses. This is the only way to ensure an SEB’s survival.
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