Kerala electricity board failed to meet performance targets: CAG

Last Updated: Sat, Feb 23, 2013 09:00 hrs

Thiruvananthapuram, Feb 23 (IANS) The state-run Kerala State Electricity Board (KSEB) has failed in meetings its performance targets in five years ending fiscal 2011-12, a performance audit conducted by the Comptroller and Auditor General of India (CAG) has revealed.

"Capacity creation of power sub-stations and lines did not meet the targets, the CAG has pointed out. Only 80 sub-stations against the target of 225 and 806 circuit km of extra high tension lines against 3,900 km were constructed in the five-year period. It said the KSEB failed to complete its projects on schedule and there were instances of time overruns ranging from three to 123 months in most projects."

Besides, a cost overrun of Rs.24.64 crore took place during the five-year period, the nation's top auditor said.

In a state with total installed power capacity of 2858 MW during 2011, the lion's share of 2041 MW of power came through 24 hydel stations, followed by thermal, which constituted 783 MW, and the rest from the central pool, while a miniscule share of electricity came through wind energy.

As per the KSEB, at the peak demand time the state requires more than 3300 MW and, hence to match the current capacity, Kerala today has an hour's power outage, with half an hour duration in the morning and in the night. At times there are unannounced blackouts as well.

The CAG report also pointed out that the existing infrastructure for transmission was not managed properly as the maintenance and monitoring wings functioned with insufficient staff and lacked modern equipment. During the period under review it was found that the annual transmission loss of five per cent exceeded the generally accepted norm, which resulted in an excess loss of Rs.299.34 crore.

A major revelation of the CAG report was that on a test check of meter readings of the 220 KV and 110 KV substations it was noticed that the incoming meter readings were less than the outgoing meter readings in respect of 20 out of the 22 sub-stations. This meant that these sub-stations distributed more power than what they received - an impossibity.

Another lacunae that surfaced during the audit was non-compliance of the Central Electricity Regulatory Commission (CERC) norm that electricity utilities of every state should show a return of 15.5 percent on equity.

"The accounts of KSEB for the year 2011-12 showed a profit of Rs 240.71 crore whereas the operation actually resulted in a loss of Rs 1,693.42 crore. The differential amount was shown as revenue gap/regulatory asset. This is not an asset, but only an accounting adjustment. Due to this adjustment, the real losses made by the KSEB are concealed," the audit note said.

When contacted, Power Minister Aryadan Mohammed told IANS that he was yet to get a copy of the CAG report.

"Certainly, all aspects pointed out by the CAG would be seriously looked into and corrective measures would be taken to see that the KSEB functions properly," Mohammed said.

The CAG has recommended that planning procedures should be streamlined with a long-term perspective/State Electricity Plan and steps should be taken to adhere to accepted practices for operations of sub-stations. Maintenance activities should be strengthened by providing adequate staff and modern equipment to testing and line maintenance wings, it said.

(Sanu George can be contacted at

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