Politicisation of electricity is disastrous: RK Singh tells poll-bound states

• 'If the state government doesn't want the consumers to pay, then they have to pay from their budget'
• 'I already have examples of subsidies which the state governments can't pay. And I am seeing more such examples coming up'

New Delhi: In the backdrop of political leaders in several poll-bound states announcing free electricity as electoral sops, Union Power Minister RK Singh said that 'politicisation' of electricity is disastrous. Singh said that political parties should not offer free electricity only if their budgets cannot accommodate it. Addressing a virtual event on smart metering by Confederation of Indian Industry (CII), the minister said, "What is happening is the politicisation of electricity. That is going to be disastrous. If you convert electricity into goods which you are going to distribute for free and you don't have the capacity to pay for it, the country will go into the dark."

"Somebody has to pay for power. If the state government doesn't want the consumers to pay, then they have to pay from their budget. And if their budget doesn't allow it, they have no right to declare subsidies which they can't pay for," said Singh.

'States can't pay subsidies offered by them on electricity'

"I already have examples of subsidies which the state governments can't pay. And I am seeing more such examples coming up when we launch this scheme (for revamped distribution sector)," Singh said. The statement came Samajwadi Party (SP), Congress and Aam Aadmi Party (AAP) have promised free electricity to voters if voted to power in Uttar Pradesh. A month ago, Punjab Chief Minister Charanjit Singh Channi had announced a reduction of Rs 3 per unit in power tariffs. Addressing a press conference, Punjab CM Channi said that the first 100 units of power will be charged at Rs 1.19 per unit for all domestic consumers, down from Rs 4.19 per unit. The consumption between 100 and 300 units will be billed at Rs 4 per unit instead of Rs 7. 

'UP doesn't have any account of subsidy to be paid by govt'

"Many state governments are finding it difficult to repay their outstanding subsidies, which they have not cleared as yet. Many states don't have the account of the subsidy which they should be paying. Uttar Pradesh is one such state that doesn't have an account of subsidy they should be paying and the discom doesn't have any account of the subsidy they should receive from the state government," said Singh.

"Minus this aspect (politicisation of electricity), which is the basic aspect, we have taken care of all the other aspects," he added. Under the government's Revamped Distribution Sector Scheme (RDSS), disbursement of loans are conditional upon state governments clearing their previous dues and undertaking to timely clearance of future subsidies.

Green Hydrogen policy to be unveiled in next 10 days

The minister also said that the government will unveil the Green Hydrogen Policy in the next 10 days, featuring incentives like free transmission of electricity for 25 years to boost the production. "We will come out with the Green Hydrogen policy in the next 10 days. We will give free transmission for 25 years. So you can generate power for making hydrogen in Rajasthan or transport it to Guwahati or to Barauni Refinery (to make hydrogen)," said Singh. The minister said that the policy will also feature dollar-denominated bids, offer of land in renewable energy parks and land allocation near ports for creating bunkers for Green Hydrogen. "We want India to emerge as exporter of Green Hydrogen," Singh told industry leaders.

(PSU Watch– India's Business News centre that places the spotlight on PSUs, Bureaucracy, Defence and Public Policy is now on Google News. Click here to follow. Also, join PSU Watch Channel in your Telegram. You may also follow us on Twitter here and stay updated.)