Electricity tariff increase hits Kashmir’s unmetered areas hard

Srinagar, June 23: A significant issue is brewing in Kashmir as 7 lakh power consumers in unmetered areas face substantial increases in their electricity tariffs, leading to widespread criticism and calls for a more equitable billing system.

The Kashmir Power Development Corporation Limited (KPDCL) has implemented steep rate hikes, particularly affecting unmetered areas.

The utility company justifies this move by claiming that unmetered areas typically consume more power than metered ones and that their load agreements have been revised.

However, consumers argue that this blanket approach unfairly penalises those who use less electricity and fails to address the core issue of incomplete metering across Kashmir.

Sajad Ahmad, a resident of Srinagar downtown affected by the hike, exemplifies the consumers’ plight.

“From Rs 500 to Rs 1800 in the last six months, my electricity bill has been increased three times,” Ahmad said. “What is my fault? I have asked the concerned KPDCL officials to install a smart meter and check my actual power consumption, but they have used a one-bill-fits-all approach.”

Ahmad's household, consisting of just two family members, is now charged a flat rate of Rs 1800 per month, which he contends is far more than his actual usage.

The scale of this issue is significant, with an estimated 7 lakh consumers in Kashmir being non-metered. This large number underscores the potential for widespread financial impact on households.

Political figures have also weighed in on the issue.

Apni Party President Altaf Bukhari criticised the move in a tweet: “The Power Development Department (PDD) is unfairly punishing poor residents of J&K by raising electricity bills monthly from Rs 500 to Rs 1050 in some areas and Rs 900 to 1600 or even Rs 2100 in other areas just to cover their inefficiencies in recovering transmission losses.”

Bukhari called on the LG’s administration to address the issue, saying, “This harassment to poor people of J&K must stop immediately!”

The recent developments follow a decision by the Joint Electricity Regulatory Commission (JERC) in December 2023, which approved a 15 percent hike in power tariffs.

This decision resulted from the JERC approving a 30 percent increase in power tariffs for non-metered consumers, with a subsequent withdrawal of 15 percent electricity duty, effectively resulting in a 15 percent tariff hike.

In Kashmir, power consumers are classified into two categories: metered and non-metered. For metered areas, the JERC had initially approved a 15 percent hike in power tariffs.

However, the PDD intervened by waiving the 15 percent electricity duty, effectively nullifying any practical hike in power tariff for metered consumers.

The JERC, in its tariff order, explained its decision, saying, “The commission noted the submission made by the utilities about the government decision of abolishing the electricity duty. The commission decided to bridge the revenue gap with the existing tariff partially with grant-in-aid being provided by the J&K government to the utilities and partially through a reasonable hike in the tariff.”

Critics argue that the KPDCL’s approach of passing on the costs of their inefficiencies to consumers is both unfair and unsustainable.

They call for a more transparent and equitable system, including accelerated efforts to install meters in all areas and implement usage-based billing.

“The power situation in Kashmir is at a critical juncture. With an annual revenue deficit of Rs 5000 crore in J&K and a significant gap between power purchases and bill realisation, the KPDCL is under immense pressure to improve its financial sustainability. Our recent load revisions are not arbitrary tariff hikes, but necessary adjustments based on actual usage. We've uncovered instances of substantial undercharging, such as a household using multiple high-wattage heaters while paying a minimal flat rate in unmetered areas,” said a senior KDPCL official.

The Ministry of Home Affairs (MHA) has also directed the PDD to provide monthly updates on five key achievable points related to the power sector.

According to a top PDD official, the MHA will review J&K's progress on these five achievable points every month.

One of the main concerns highlighted is the staggering revenue deficit of Rs 5000 crore faced by the PDD, which officials deem unsustainable.

“Post-August 2019, power corporations are operating in J&K who cannot sustain such huge recurring losses,” the official said. “Therefore, the administration has asked both power corporations of J&K to improve revenue realisation.”