Water Board gets shock treatment

• Every month, Water Board gets Rs 50 cr in the form of water cess and electricity bill for an equal amount
• CPDCL charges HMWS & SB at the commercial rate for power consumed
• Water Board owes Rs 250 cr to CPDCL as arrears and pays 18% interest
• With vested interests impeding board’s efforts to recover Rs 650 cr from consumers and government departments, the entire amount has to be treated as bad debt
• Worse, Govt is not paying the subsidy amount
• Krishna phase III and Godavari projects are being undertaken with borrowed money

“Earlier, the power bills used to be only Rs 22 crore per month, but it more than doubled when the tariffs and surcharge were revised in December 2011. We are getting Rs 50 crore as water cess per month and Rs 50 crore as electricity bill; and they are charging us at commercial rates.”

Aditya Parankusam

The Hyderabad Metropolitan Water Supply and Sewerage Board (HMWS & SB) has started feeling the pinch to pay salaries as it is now being weighed down by mounting debts, including unpaid electricity bills and other dues. The board’s meagre budget is stretched to its limits so much so that it is now completely dependent on release of external loans for making some progress in respect of new projects. The Board has taken a loan of Rs 1,000 cr from HUDCO for the ‘Godavari project’ and Rs 1,500 cr for the ‘Krishna Phase-3’ and it is paying Rs 10 cr per month as instalments.

The electricity authorities are charging the water board at commercial rates. The two phases of the Krishna project run on 8 cr units; Manjeera and Singur projects run on 2 cr units; while about 1 cr units are used for pumping and other activities. While it costs Rs 25 per kilo litre for the water board to pump water, the subsidy component of the water supplied to people works out to Rs 10 per kilo litre. For that matter, the government is yet to pay the subsidy component to the water board. The water board’s only source of revenue is new connections and water cess. The Board has bad debts totalling Rs 650 cr.

This includes money that consumers and government departments owe to the Board. “Any attempt to recover these debts is stopped using political influence,” said a senior official in the revenue department of the Board. It is estimated that the upcoming projects require 10 cr additional units of electricity which would cost Rs 45 crore per month. If this is added to the existing bills, the outgo under this head would amount to a whopping Rs 95 crore. With income from cess being only Rs 50 cr, questions are being raised over how the Board would pay the bills.

When contacted, J Shyamala Rao, Managing Director, HMWS & SB, told Hyderabad Hans: “Earlier, the power bills used to be only Rs 22 crore per month, but it more than doubled when the tariffs and surcharge were revised in December 2011. We are getting Rs 50 crore as water cess per month and Rs 50 crore as electricity bill; and they are charging us at commercial rates.”

On the upcoming projects and their effect on the electricity bill, Shyamala Rao said: “With these projects, we are expecting new connections and new customers, but there will not be any proportionality in our income and the bills. For the debt of Rs 230 crore to the electricity board, we are paying 18% interest. We have written to the government to support us”.