Report of Indian Institute of Public Administration ... - Ministry of Power

State Reports (Vol.-III)
Study on `Impact of Restructuring of SEBs’
been performing at a high level of plant load factor and has been the recipient of
several awards for its PLF, reduction of secondary and fuel oil consumption, etc.
KARNATAKA ELECTRICITY BOARD AND ITS PERFORMANCE
A brief account of the performance of KEB, before it became extinct on 31 May 1999
would be of some interest. During the year 1998-99, the total energy generated in the
generating stations within the State was 17,066 MU and the total power available for
sale was 22,746 MU. However, the actual sale to the consumers came to only 15,909
MU, which worked out to about 70 per cent of availability. The T&D loss during the
year, as per the records of the Board, came to 6,868 MU (30.2 per cent). About 44 per
cent of the total sales were to the agricultural sector, which was the lowest revenue
generator.
In its last year of functioning, namely, 1998-99, KEB had a total income of Rs
3,927.26 crore (inclusive of Rs 913.89 crore of rural electrification subsidy) and
incurred a total expenditure of Rs 3,860.27 crore, thereby generating a surplus of Rs
66.99 crore. Excluding the above subsidy, the year would have closed with a shortfall
in income of Rs 846.9 crore. The capital expenditure for the year was Rs 676.40 crore.
The total outstanding loans came to Rs 2,242.04 crore. The accumulated depreciation
was Rs 1,333.76 crore, with gross fixed assets valued at Rs 4,063. 98 crore.
The Board, at the time of its dissolution, had a staff strength of 45,982 including those
on contract basis. Establishment expenses came to Rs 743.24 crore, which amounted
to some 19.25 per cent of the total expenditure for the year.
STATE SUBSIDY TO THE POWER SECTOR
Power sector all over the country is known for the heavy subsidies provided to it year
after year by State Governments, and Karnataka is no exception. But for such
subsidies, the KEB would not have survived for long; indeed, the major determinant
and the prime motivation for reform in the power sector, as mentioned earlier, came
from the high, unsustainable level of subsidies, which remained an all-time threat to
the fiscal stability of the State. The subsidy was mainly intended to benefit the
agricultural sector; but in the absence of efficient and complete metering of the energy
sold by the utilities to various categories of consumers, there was no mechanism (even
now) to assess the actual extent of energy supplied to the farmers for genuine
3.8