Financial prudence, the reduction of the loan allowed PSPCL to make profits for the first time in 5 years
Patiala Financial diligence, lower cost of money and improved operational efficiency led Punjab State Power Corporation Limited (PSPCL) to report a profit of ??1,446 crore for 2020-21 for the first time in five years. In 2019-2020, the utility reported a loss of ??1,158 crores. Transmission and distribution losses also decreased slightly.
Elaboration, President and General Manager A Venu Prasad said: “We have seen a reduction in the financial costs of ??1,306 crore due to the Ujwal-DISCOM Assurance Yojana (UDAY) program; there has been an increase in the cost of owning ??577 crore for late payment of the subsidy, increase in the subsidy by ??570 crore due to the funding of losses from previous years and the increase in the late payment surcharge of ??156 crore of consumers.
He added that the annual accounts were approved on Tuesday at a meeting of the PSPCL board of directors, where Anurag Aggarwal, additional chief secretary (power), and principal finance secretary, KAP Sinha, were also present.
Prasad added that the utility had reduced its borrowing by 4% and reduced its financial cost by restructuring the loans. “PSPCL obtained a discount of approximately ??150 crore in 2020-2021 against payments for the purchase of electricity by efficient management of its working capital, ”he added, mentioning smart meters as another major initiative towards a better system.
“To better control citizens’ spending on electricity bills, smart meters can also be used as prepayment meters in the future. This measure will undoubtedly improve the operational competence of the company by significantly reducing transmission and distribution, ”he said, adding that cheaper electricity has replaced expensive electricity purchased from other sources. As part of this process, PSPCL purchased approximately 724 million units from ??2.76 per KWH, resulting in a 6.4% drop in the cost of purchasing electricity during the last financial year.
Prasad also thanked the government of Punjab for its continued support to the power sector, as it had released a grant of ??9,657 crore in 2020-2021, covering important sectors like agriculture, industry and the weakest strata of society.