Power losses a serious drag on J&K’s finances: CAG

Srinagar: Jammu and Kashmir government has incurred a loss of whopping Rs 2281 crores on electricity in financial year-2012-13, and as such continues to be a serious drag on its finances, according to the Comptroller and Auditor General.

“Steadily rising gap between the revenue expenditure of the Power Development Department (PDD) and the department’s revenue receipts is the most significant structural imbalance in the budget of the government and a drain on the resources which could otherwise be deployed for developmental outlays,” CAG said in its latest report.

It said that unrestricted peak power demand exceeds 2700 MW during winter in Kashmir and summer in Jammu.

“With increasing economic activity, the demand is steadily rising. The targeted public distribution system in the state covers 19.72 lakh households.”

As per Census 2011, 85.14 per cent households have access to electricity. However, only approximately 50 per cent electrified households are serviced through properly functional meters. “The transmission and distribution losses are the highest in the country. Therefore, the financial losses of the PDD continue to be a serious drag on the finances of the state,” the CAG said, underling that it is a growing “fiscal hole” that cannot be sustainably filled by resource transfers through the Finance Commission and the Planning Commission of India.

It said the transmission and distribution losses, measuring energy lost during transmission as well as un-metered drawls, are “unacceptably high” and out of line with national average.

“The transmission and distribution losses were 61.61 per cent in 2011-12. It ranged between 4.43 and 8.14 percent against the Central Electricity Authority norm of four percent during the period 2008-12.”

The government, it said, has acknowledged that the biggest weakness is on the distribution front.

“It necessitates undertaking necessary reforms for cutting down these losses besides appropriate tariff revision.”

However during 2012-13, some progress was made and about 1.5 lakh registered customers were added, including regularized unauthorized connections.