Government robbing Peter (Industry) to pay Paul (Voters): Industry bodies

Power cuts and power tariff hikes are both a anathema to the growing industry, more particularly in Telangana and Andhra Pradesh which have several service and manufacturing industry. In the back drop of the ARR (aggregate revenue requirement) of the power utilities before the ERCs ( Energy regulatory commissions) of both states, the industry bodies are making a case against power tariff hikes.

Several Industrial bodies of Andhra Pradesh have opposed power tariff hike for industrial and manufacturing sectors stating that it would not be fair in the absence of specific incentives for them, either from the Centre or the state. "It is like robbing Peter to Pay Paul," they said indicating that governments were slapping hikes on industry to meet the welfare sops to voters (consumers).

In a detailed submission to the APERC, the FAPTCI said the power utilities have projected an average procurement price of RS 6.10 from the power exchanges and open market. "Two years ago we demanded a tariff of Rs 5.06 per kWH for industry, but even when the rates crashed in open market and power exchanges the same is continued at Rs.6.10 per KWh," they lamented .

Both Telangana and AP government have asked the centre to declare several districts as backward to facilitate cheap power to industry sector. "While in Telangana 6 of the 10 districts are already listed under Backward Region Development Progam, in Andhra Pradesh 7 of the 13 are listed as backward. "The governments have always made cross-subsidy tool to fund the deficit arising from power subsidies to the poor," says a spokesman of the ERC.

However, the free power concept of both AP and Telangana are costing a bomb to the state exchequer. While it is nearly Rs.2400 crore for Telangana it is almost 2200 crore for AP (Telangana has largest number of bore well cultivation) .