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Free Power today, what about tomorrow?

Karnataka Elections 2023: The Congress had promised that upon coming to power, it would provide 200 units of free power to light the homes in the state. Now it has come to power and is all ready to light the houses of all Kannaḍigarus. The KERC cost per unit of electricity is ₹9.12 per unit means, the electricity of Rs 1824 will be free for the next five years till the Congress government is in power.

Well for the Indian electorate, electricity has always been important– in terms of access, reliability & cost. It is always one of the subjects to pull the electorate towards the party promising free power to come to POWER.

The freebies culture just ahead of elections was started by late Tamil Nadu Chief Minister, J Jayalalithaa. It was during her tenure that the freebie culture started with promises of free sarees, pressure cookers, television, and more. Nationwide political parties quickly adopted this, while free electricity units as a promise was started from Delhi, with Aam Aadmi Party founder Arvind Kejriwal promising free power (to certain units), free water, bus travel, and more to win the elections in 2015.

Now with several assembly elections scheduled this year, political parties are promising free power. But, we are oversubsidizing in most states, and doing it inefficiently. Offering free or subsidized electricity to ‘vote banks’ achieves the short-term goal of winning elections. In the long term, it erodes the financial viability of the electricity distribution sector. This is not a problem of DISCOM inefficiency but rather a problem of political expediency. Consumers in Delhi enjoy free electricity up to 200 units a month, which means several citizens get zero monthly bills. In Tamil Nadu, users get up to 100 units of free electricity consumption.

If an elected government wants to keep a poll promise of reduced or free electricity, it has to compensate the power distribution company for the difference. State governments either subsidize or take over the debt of Discoms. A case in point is the Ujjwal Discom Assurance Yojna (UDAY) scheme when state governments floated bonds to retire the debt of #DISCOMS

But what really happens in the majority of the cases is that power distribution companies incur massive losses. Discoms owed a total of Rs 1,15,904 crore to power generation firms in January 2021, according to portal PRAAPTI (Payment Ratification And Analysis in Power Procurement for bringing Transparency in Invoicing of Generators).In January 2022, the total overdue amount, which was not cleared even after 45 days of a grace period offered by generators, stood at Rs 1,01,357 crore as against Rs 99,650 crore in the same month a year ago. The overdue amount stood at Rs 99,981 crore in December 2021. Discoms in Rajasthan, Uttar Pradesh, Jammu & Kashmir, Telangana, Andhra Pradesh, Karnataka, Madhya Pradesh, Maharashtra, Jharkhand, and Tamil Nadu account for the major portion of dues to gencos, the data showed.

The manifesto announcements favored political parties with accumulated losses of 30 DISCOMS spread across 9 states accounting for over 60% of power demand are estimated at Rs 700 billion, for 2022 shows data from Crisil. India boasts that 40% of its power capacity is now based on renewables. But competition between political parties in election pledges has resulted in more and more states providing free electricity to domestic consumers. This subsidizes rather than taxes carbon.

Political parties in a sheer desperate attempt to regain lost national relevance, are choosing to follow in the footsteps of the Aam Aadmi Party and pledged free units of free energy to secure public loyalty and obedience prior to the election. In the recent elections in Karnataka where Congress came to power, it promised 200 units of free energy through its statewide campaign to brighten every house with
light calling the scheme ‘Gruha Jyothi Yojane’.

Political competition in freebies has already made agricultural power free in most states. Domestic power is going the same way. This undercuts the government’s green commitments. #power #india
#karnatakaelections #freebies #elections #karnatakaelections2023.



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