High AT&C power losses continue to drain J&K's exchequer

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Srinagar: The Jammu and Kashmir's Aggregate Technical and Commercial (AT&C) power losses, which are the highest among all states and Union Territories (UTs) in the country, continue to be over 50 percent, depleting J&K’s coffers.

"The AT&C losses of the J&K Power Department are one of the highest in the country. The present AT&C losses are of the order of 50 percent against the national average of 19.73 percent. Due to these losses, the gap between power purchase cost and revenue realisation is huge," reads a note from the J&K government.

As per the officials, Aggregate Technical and commercial (AT&C) losses comprise technical losses that primarily take place due to transformation losses (at various transformation levels) and high losses on distribution lines due to inherent resistance and poor power factor in the electrical network.

Commercial losses are any illegal consumption of electrical energy, which is not correctly metered, billed and revenue collected, causing commercial losses to the utilities.

Commercial losses occur due to discrepancies in meter and theft by direct hooking and collection inefficiency.

"Due to the existence of long LT lines carrying electricity to distant and scattered households over the mountaintop, a substantial quantum of electricity is lost at I2R loss leading to the high cost of power supply in J&K,” it said.

A senior official from Kashmir Power Development Corporation Limited (KPDCL) said that the increasing AT&C losses result in greater financial losses for J&K.

"As a result of the costs associated with assuring the availability of power and customer bills, we are now experiencing a significant income shortfall. Revenue and spending are out of balance, which costs the government money," he said. "Although AT&C losses have decreased over the past 10 years, they are still on the higher side, much to the administration's pain. The quality of the power supply will significantly improve once AT&C losses are comparable to the national average."

According to officials, installing smart metres and upgrading the infrastructure are two important reformative actions that would help reduce AT&C losses in J&K.

Official estimates indicate that J&K loses Rs 3400 crore yearly as a result of revenue shortfalls and distribution costs.

Lieutenant Governor Manoj Sinha in July said, “We have taken a loan of Rs 31,000 crore from the Centre in the last four years to provide electricity to the people of J&K. This kind of system cannot sustain for long."

Power purchases continue to be a big drain for J&K's exchequer, as the union territory has spent a whopping Rs 55,254 crore on purchasing electricity from outside power companies in the last 10 years.

As per the official data accessed by Greater Kashmir, power purchase bills from outside power discoms have reached Rs 55, 254 crores in the last 10 years (2012-13 to 2021-22).

According to the available data, the J&K government spent Rs 8197 crore on 16,207 million electricity units in 2021–2022 while 14,362 million units cost Rs 7047 crore in 2020–21.

In 2019-20, 13,345 million units were purchased for a cost of Rs 6987 crore. Similar to this, power purchases totaled Rs 6561 crore in 2018-19, Rs 4844 crore in 2017-18, Rs 4752 crore in 2016-17, Rs 4803 crore in 2015-16, Rs 4719 crore in 2014-15, Rs 3959 crore in 2013-14, and Rs 3382 crore in 2012–13.

The data also shows that there is an increase in the amount of money spent on purchasing power from outside of J&K. 

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