APDCL records 620% accumulated loss in five years
Against the backdrop of ‘power sector reforms’ being carried out by the power department of Assam government, the accumulated losses of Assam Power Distribution Company Ltd (APDCL) had shot up staggeringly by 620 per cent in five year, beginning 2006-07 and ending in 2010-11. The accumulated losses of the company increased from Rs. 142.90 crore in 2006-07 to Rs. 1,029.61 crore in 2010-11, which is an increase of Rs. 886.71 crore, found the recently submitted Comptroller and Auditor General’s (CAG) report.
Further, the audit report observed that the borrowings of APDCL increased by 74.40 per cent from Rs. 479.58 crore in 2006-07 to Rs. 836.40 crore in 2010-11. The realisation per unit increased from Rs. 4.71 to Rs. 5.74 (21.87 per cent) during 2006-11, whereas the cost per unit increased from Rs 5.02 to Rs 7.00 (39.44 per cent) during the corresponding period.
The audit report said that “due to unnecessary drawal of loan fund and its non-utilisation, APDCL had burdened itself with a total interest liability of Rs. 42 lakh to the Assam government..
The debt-equity ratio ranged between 2.95:1 and 4.60:1 during the same period. “Increase in debt-equity ratio in 2010-11 as compared to 2006-07 was due to increase in unsecured loans,” the report said. At a time when the accumulated loss was mounting, the company could not recover its operational cost in any of the years as it failed to attain category wise sales-mix and restrict sub-transmission and distribution losses within the limits prescribed by AERC, found the CAG report. “We noticed that long length of the feeders, non-installation of capacitor banks, low power factor, un-metered consumers and theft of electricity etc. had contributed to energy losses,” stated the report.
It added: “APDCL, in reply, stated that it had taken various steps for improvement of sub-transmission and distribution losses viz. addition of transformation capacity as per 17th report of Electric Power Survey Committee, installation of meters for un-metered consumers, replacement of stop/defective meters and reduction in theft cases. However, the fact remains that APDCL was yet to achieve AERC norms for energy losses.”
Among the state public sector undertakings (PSUs) of Assam, APDCL was the third most loss making company in 2010-11 as it incurred a loss of Rs. 8.62 crore.
As part of power sector reforms, the erstwhile Assam State Electricity Board was unbundled and consequently, the business of power distribution was carried out by three distribution companies namely, Upper Assam Electricity Distribution Company Limited (UAEDCL), Lower Assam Electricity Distribution Company Limited (LAEDCL) and Central Assam Electricity Distribution Company Limited (CAEDCL), which were incorporated on October 23, 2003 under the Companies Act, 1956.Subsequently, the two companies viz., UAEDCL and CAEDCL were merged with LAEDCL on April 1, 2009 and LAEDCL was renamed as Assam Power Distribution Company Limited (APDCL), which was incorporated on October 23, 2009 under the Companies Act, 1956.
As on March 31, 2011, APDCL had distribution network of 1.12 lakh Circuit Kilometers (CKM) of lines, 36,240 sub-stations and 34,664 transformers of various categories catering to 19.13 lakh consumers.
Source- Business standard