The Kerala State Electricity Board Ltd (KSEBL) seems to be passing through one of its worst patches as the state’s power monolith finding it difficult to wriggle itself out of the grips of loss.
KSEBL, whose financials are yet to reach the public domain, is understood to have more than quadrupled its loss for the financial year 2016-17 to reach a whopping Rs1652.45 crores compared with Rs313.29 crores, the company posted for the previous year.
The fact that this happens at a time when the government keeps reiterating its avowed stance to bring the loss making public sector companies (PSUs) back in black is sure to give sleepless nights to the government. However, it is also learnt that many PSU companies have improved their performance in the past one or two years.
More importantly for KSEBL, the accumulated losses to the tune of Rs3266.17 crores have flagged bad signs financially, as these losses are fast nearing the size of its share capital at Rs3499.05 crore. The government grant for an amount of Rs1432.98 crores has come to the rescue as this will help beef up the thinning capital base to an extent.
The biggest hit to the bottom line has come from the huge power purchase expenses that have grown by Rs1327 crores to reach a record high of Rs7664.40 crores as the financial year closed on March 31, 2017.
Interestingly, the company’s own power generation expenses dropped drastically during this period from Rs104.25 crores to Rs23.44 crores. Though there could be umpteen structural and other reasons that played their role in pushing the company into the present financial crisis, KSEBL seeks relief from the financial burden some major consumers are imposing on KSEBL by way of their external power purchase through ‘open access’.
The government power major has already approached the Kerala Electricity Regulatory Commission (KERC) seeking permission to collect cross subsidy surcharge (CSS) and an additional surcharge from these consumers to help combat the mounting loss for the company.
Open access allows electricity consumers in the state to buy power from suppliers of its choice and use the transmission network of the KSEB to bring it home. However, the commission has not allowed the KSEB to collect surcharge to make up for the financial loss it suffers when its high-end consumers abruptly drop the KSEB to go shopping with private suppliers.