CAG picks holes in power audit, Himachal electricity board losses double

Shimla: The losses of Himachal Pradesh State Electricity Board Limited (HPSEB) are much more than what board has been showing, for the Comptroller and Auditor General (CAG) after auditing the accounts for 2011-12 have put the losses at Rs 676 Crore, which is more than double of what is shown in the books.

Addressing reporters Principal Accountant General (AG) Satish Loomba said the HPSEB had not only purchased power from outside the state at exorbitant rates but also committed irregularities in payment of revised wages and other benefits to its employees under the Sixth Pay Commission norms.

“The HPSEBL showed a loss of Rs 315 crore during 2011-12 but when CAG auditors scrutinized the losses, these were found to be more than double of what the HPSEB had declared. We have told the HPSEB that its accounts are not a true reflection of its financial position and so we have awarded it a negative grade,” said Loomba.

A 20 year performance audit of the hydropower sector in the private sector showed that of the 559 projects allotted since 1991 that had a generation potential of 10,131 MW, only 55 projects (10 percent) of them had been commissioned by 2012.

However, CAG was unable to calculate the revenue losses the state incurred because of delays and enhancing of project capacities because of faulty project investigation reports.

“Though we believe that the government is on a learning curve as far as power projects implementation is concerned but it is required to fine tune agreements with companies and ensure that core areas of projects are not out sourced to consultants who have no accountability,” Loomba added.

The CAG report has also drew attention to the lack of proper environmental protection measures during execution of these projects, besides the inability of the government to invoke the mandatory clause of 70 per cent jobs to Himachali’s in hydropower projects.

Commenting on state public enterprises, CAG observed that the fiscal situation of all 19 PSUs in the state was not good and of total declared losses of Rs 1360 crore, Rs 224 crore was reported in 2011-12.

Saurabh Chauhan, an independent journalist, has 10 years of experience in Print and Digital Media. He has written on a variety of issues including women’s rights, environment, crime, governance, finance and politics at Shimla, Chandigarh and Lucknow. Saurabh is currently based in Lucknow.

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1 Comment

  1. says: D K Sharma

    Hydro power development in the State appears to have lost way in the last half a decade. Hydro power sector in Himachal Pradesh needs a swathe of reforms towards realizing the potential in a time bound frame so that the State gets much needed boost in resource flows into the coffers and the national economy derives the multiplier effect in enhanced productivity resulting from sustained and un-interrupted power supply. The HPSEBL will continue to stay on the so called learning curve till eternity without adding any critical mass to its knowledge. Un-bundling the HPSEB has ended up creating a couple of more identically moribund entities which are unlikely to lead anywhere until the mindset changes take place. The adverse grading handed down by the CAG should cause some shake up in the haloed HPSEBL!!

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