Power sector suffered losses of Rs 1.29 lakh cr during YSRCP regime, claims Andhra CM

Amaravati: Andhra Pradesh Chief Minister N Chandrababu Naidu on Tuesday blamed the previous YSRCP government for causing losses of over Rs 1.29 lakh crore to the power sector.

Releasing a white paper on the state of the power sector in the state, the Foreign Minister said the tariff burden on consumers stood at Rs 32,166 crore, the increase in debt of power companies in Australia stood at Rs 49,596 crore and losses due to inefficient management stood at Rs 47,741 crore.

We have introduced power sector reforms 1.0 and 2.0, now we need power sector reforms 3.0 to transform the sector for the empowerment of the society, Naidu said while addressing a press conference at the secretariat. He noted that power sector reforms 1.0 and 2.0 were carried out during the previous TDP government.

The Prime Minister said that under the Power Sector Reform 3.0, the government has to address losses running into over Rs 1.29 lakh crore, instill investor confidence, rebuild brand Andhra Pradesh and ensure quality and reliable power supply at affordable prices, preventing power cuts in the rapidly transforming sector.

Naidu attributed the losses incurred by the sector to delays in commissioning of thermal power plants, Polavaram hydroelectric project, additional impact of short-term power purchases and other factors.

He estimated the interest burden on loans at Rs 10,892 crore and the cumulative losses on account of poor performance of distribution companies (DISCOMs) and Andhra Pradesh Power Development Company Ltd (APPDCL) at Rs 9,618 crore.

According to the CM, the YS Jagan Mohan Reddy-led government had stripped companies of incentives already provided under the TDP scheme between 2014 and 2019 and renegotiated solar and wind power purchase agreements (PPAs), leading to legal challenges.

The TDP chief accused Reddy of burdening the common man with inflated electricity tariffs by charging fuel surcharge, corrective charges and excise duty on electricity, resulting in a 98 per cent tariff hike for the poorest power consumers, which could even go up to 50 units.

Poor consumers were hit by higher tariff hikes of 78-98 per cent compared to 29 per cent for middle class consumers. A total of 153 lakh consumers were affected.

Naidu said that due to the increase in debt of power companies from fiscal 2018-19 to fiscal 2023-24, it has gone up from Rs 62,826 crore to Rs 1.12 lakh crore.

He said short-term loans taken at a high interest rate of 10.11 per cent to manage cash flow had been an additional burden of around Rs 10,892 crore in the last five years.

Similarly, receivables increased from Rs 12,945 crore to Rs 52,091 crore.

Naidu further blamed Reddy for not commissioning any new solar, wind, hybrid or storage projects under the YSRCP scheme. Noting that the state’s DISCOMs had lower credit ratings, he said it had an adverse impact on them in the form of a 1.1 per cent hike in interest rates. The CM further alleged that the power shortage during the previous YSRCP government affected the GSDP growth in the state. Citing these alleged irregularities, Naidu said the brand image of Andhra Pradesh had been tarnished and also the confidence of investors had been damaged.

Therefore, I seek input and support from all stakeholders to strengthen my capabilities and make Andhra Pradesh the energy hub of the future,” Naidu said, referring to the next steps.