Nagaland Power status: Collections at all time high, but revenue-purchase gulf widens

Nagaland Power status: Collections at all time high, but revenue-purchase gulf widens

• Record 300-plus cr purchases offset Rs 150cr revenue
• Is pay and use the answer?

Imkong Walling
Dimapur | June 10
Revenue from electricity registered an all time high of Rs. 150cr for the period 2018-19 making a jump of Rs. 20cr from the Rs. 130cr collected in 2017-18.

The revenue growth was however negated by a high purchase cost that peaked at a record Rs. 325cr in 2018-19. For the ongoing 2019-20, the Department of Power Nagaland (DoPN) forecasts a requirement of around Rs. 350cr.

The annual purchase cost for power is projected to grow with each passing year; on the otherhand, revenue stutters, clocking below the halfway mark let alone breaking even. (See table)

Bridging the gulf
Narrowing the revenue-purchase gap, coupled with an over-strained electricity infrastructure remains the two biggest challenges for the department.

As reported earlier, it demands a complete overhauling/upgrading of the existing electricity supply equipments and streamlining the revenue collection system.

A Centrally funded Integrated Power Development Scheme with an all-India objective of counteracting the challenges is already operational in Nagaland.

However, DoPN officials have attributed local factors, particularly the revenue segment, as posing threat to diluting its professed objectives.

The challenges included the usual suspects- faulty or under billing, theft and pilferage, billing disputes, unpaid dues and more importantly, making the consumers aware of the importance of paying for electricity.

It is predicted that the revenue segment will continue to struggle unless radical measures are adopted.

One measure, according to DoPN officials, would be transitioning into a ‘pre-paid’ system like in the telecoms.

Pre-paid the answer?
Farfetched it may, the concept of pre-paid electricity is not new to the state. The DoPN already has a pilot project in operation since 2013.

“Pre-paid will greatly contribute in reducing Aggregate Technical & Commercial (AT&C) losses and increasing revenue collection,” said one official, who wished to be anonymous.

It is already implemented in select cities and urban townships in Assam and Meghalaya. In Manipur, he informed that more than 70 percent of the total consumers have been converted to pre-paid metering since the Manipur State Power Company Ltd (MSPCL) started transitioning into the system in 2015.

It started as a pilot project in 2012 and today, he informed, “The MSPCL has been able to reduce AT&C losses to 30 percent from 60 percent. It (Manipur) is one of the country’s best performing states in the power sector.”

With the project a success, he added that the Manipur state government is seriously pursuing to bring its remaining consumers into the pre-paid fold.
The DoPN also adopted the Manipur model as a pilot project in Dimapur. It was introduced in Marwari Patti in November 2013. He asserted that the pilot project has been a success with 40 percent loss reduction in the area covered.

“With such a system in place, people will get conscious about power usage, which would automatically reduce consumption thereby reducing the load on the neighbourhood distribution transformer.”

According to him, there was no major instance of transformers overloading and breaking down in Marwari Patti since then. This is in stark contrast to other localities where overloaded transformers breaking down have become frequent phenomenon.

Proposal cold-shouldered
On the prospect of emulating Manipur, he said that the department has made a proposal but the state government was not amused.

“We submitted a DPR (styled on the Manipur model) for pre-paid meters in all the statutory towns of the state with an estimated cost of Rs. 372cr.”
If implemented, it would require the replacement of roughly 1.9 lakh existing meters out of the total 2.87 consumers.

“Investment will be high but the longterm returns cannot be ignored,” he said.

Cold-shouldered, the department approached the North Eastern Council and also a Japanese firm. The latter was said to have displayed interest but reportedly backed out over security concerns.

They next approached the Central government and the Asian Development Bank (ADB). The ADB has shown interest but he added, “There is still a long way to go.”

Meanwhile, he admitted to the department lacking strong vigilance mechanism. He attributed it to situational constraints i.e. deficient workforce and upkeep funding for a dedicated vigilance system.

“We have an Anti-Power Theft Mobile Squad but its effectiveness is limited for a lack of personnel and fund from the government.”