KSEB to become another KSRTC?

"KSEB will soon become another KSRTC if it proceeds in the current manner." This was said by none other than Biju Prabhakar, Chairman and Managing Director of the Kerala State Electricity Board. Having moved from the post of KSRTC CMD to the head of KSEB, he may have felt that the current state of the board was painful. The ongoing financial crisis and lack of proper planning over the years are rounding up KSEB, one of the largest public sector undertakings in the state. The fact that KSEB has not yet had that fate of KSRTC, which shamelessly extends its hand before the government to pay salaries to its employees every month, is only because the regulatory commission allows KSEB to increase fares frequently and impose surcharges. However, the board heads themselves are now wondering how long they can go on like this by making the customers suffer. The mismatch between income and expenditure cannot be compensated by rate hikes and additional surcharges.

More than Rs 400 crore has to be borrowed from financial institutions at interest every month to meet the day-to-day expenses. While the revenue stands at Rs 1,750 crore, the expenditure is Rs 1,950 crore. Like parallel lines that never collide, the income and expenditure continue to remain unchanged in this way. Since the domestic generation of electricity is deficient, power has to be purchased on a large scale from outside at a higher price. On the one hand, the crisis faced as a result of the unilateral cancellation of power purchase agreements made earlier without thinking ahead. On the other hand, there are rainy nights where restrictions have to be imposed due to a lack of power availability despite receiving rain. The board's planning defects are numerous.

The CMD has warned that if immediate steps are not taken to overcome the crisis of the board, the future of the institution will be in the dark and the state will head towards a severe power cut. Large capital investment is required to reach the target of achieving an installed capacity of 10,000 MW in the next five years. For this, a CIAL model company can be formed and investments can be received through bonds from financial institutions, employees, the general public and large customers. The big shots on the board will not like this for sure. Investment will be available for sure if there is a government guarantee that the investments will get dividends after a certain year. Even private companies need only two or three days to get the huge amount of investment they are demanding. As such, a public sector undertaking will not have to face any difficulty in finding investments.

Hydel power generation of less than 25 MW should be undertaken by local bodies, start-ups and large HT consumers. Such small power generation stations in various parts of the state have been lying unfinished for years. Despite seeing the need, the board show no zeal to finish the work and start generating electricity. The fact that solar power is becoming more and more acceptable will reduce the burden of the board. The board just need to give the necessary encouragement. KSEB now requires Rs 900 crore to buy electricity every month from outside. This is what is ruining the financial position of the board. Other factors are uncontrolled governance and the insistence that there will be no change in the traditional approaches. In any case, people cannot accept the board becoming another KSRTC. One of those is enough.