PDD to discuss matter with CM before issuing orders
In the latest poll sop, the National Conference-Congress coalition government has worked out a proposal to reduce the electricity duty from present 22 percent charged from consumers.
Officials said Power Development Department (PDD) is working on the proposal to reduce the electricity duty. According to them, the current collections made from charging the electricity duty are nearly Rs 260 crores a year.
“PDD is working out a proposal to find out how much loss it can afford after the cut in the electricity duty,” officials said.
About Rs 100 crores are collected as electricity duty from Kashmir and around Rs 160 crores from Jammu province.
Officials said the proposal to reduce the electricity duty will also be submitted to the cabinet for clearance.
Minister of State for Power, Viqar Rasool, said the matter will be discussed with the chief minister before a formal decision is taken in the matter.
According to officials in the finance department, the State can fund the subsidy on account of reduction in electricity duty as government has saved about Rs 800 crores by increasing the retirement age of employees.
“Since we don’t have to release pension benefits to a large number of employees, who retired this year, the money that will be saved can be utilized by the state in other projects,” they said.
The money for creation of administrative units, according to government official, will also come from the savings made from delaying the release of pension benefits to employees.
According to PDD officials, the reduction in electricity duty will be an additional subsidy to the consumers and is only a poll sop as government has been holding the position that there is a big gap between the purchase of electricity and recoveries as tariff.
According to them, the government is also facing wide gap between the power demand as generation from own sources has been less and the State has to depend on buying power from outside.
Officials said the average cost of purchase is around Rs 3.46 per unit of electricity and the budgetary allocation for the purchase of energy crosses Rs 3,300 crore annually.
“The recovery of tariff has not been helping the government to meet the gap between cost of purchase of power and the revenue realized. The revenue realized has been much less than the fixed target,” they said.