Funds Were Also Squeezed In The Name Of Substations By The Jagan Government

• General

• December 30, 2024

The Jagan government has allegedly transformed the power department into a means to make personal gains. Here, the government sanctioned substation projects without proper assessment based on profit-making ideas rather than the operational needs of power companies. For example:

• In YSR Kadapa district, 68 substations were approved due to recommendations from MP Avinash Reddy.
• 30 substations were sanctioned in the constituency of then-Minister Peddireddy
• Substations were demanded by YSRCP leaders in unwarranted locations, motivated by political reasons.

As a result of these whimsical decisions, the coalition government cancelled 140 substations for which the construction had yet not begun. This saved about Rs. 2.5 crores per substation, thus minimizing the financial burden on DISCOMs.

Annual Plans Missed and Unnecessary Expenses

Power companies generally plan development projects to ensure uninterrupted electricity supply within a five-year horizon. The State Power Plan 2020-24 identified substations with frequent disruptions and recommended their capacity enhancement or replacement.

• The plan proposed the development of 927 substations at an estimated Rs. 1,891 crore.
• However, 350 more substations were cleared to satisfy political interests adding Rs. 875 crores to the DISCOMs' expenses.

These decisions have deteriorated the financial health of power companies, which are already reeling under debts running into Rs. 1.12 lakh crore.

Corruption in Substation Projects

There are allegations that the substation clearances given by the previous government were corruption-ridden:

• Contractors allegedly paid commissions to get these projects.
• Each substation created four operator posts, which some MLAs sold for Rs. 7–10 lakh each.
• Local MLAs reportedly pocketed as much as Rs. 1 crore on each substation project.

Such misuse escalated the cost of maintaining the sub-stations on DISCOMs, and they, in turn, have to recover this by way of Fuel Adjustment Charges (FPPCA) on consumers.