Delay in implementing smart electricity metre project could adversely affect Kerala's finances

Thiruvananthapuram: The delay in implementing the smart metre project may adversely affect the Kerala government's opportunity to borrow Rs 4,060 crore as a loan from the union government in the current financial year.

KSEB trade unions are rallying against the government's move to bring private entities to implement the project. As a result, KSEB is yet to sign a contract with the company proposed by the union government.

KSEB fears the delay may force the union government to freeze the Rs 10,469 crore grant allocated to the project. Meanwhile, the state government has also shown disapproval of how KSEB managed the situation.

Earlier, the union government proposed an additional 0.45 per cent in the state's borrowing limit if the smart metre project is implemented in Kerala. Further, the union government proposed appointing REC Power Distribution Company Limited (RECPDCL) to provide technical support for the project. However, the trade union suggested bringing in KSEB's engineers or union government agencies like C-DAC.

In addition to losing a significant amount from the borrowing limit, the state government will also have to return Rs 1,100 crore allocated for modernisation in the power sector. Further, the state will have to return Rs 2,480 allocated for compensating losses during sales, Rs 1,389 to set up smart metres and Rs 6,600 crore for modernising the board.