KSEB heads for downsizing to bring down employee cost

Thiruvananthapuram: The Kerala State Electricity Board (KSEB) Ltd is exploring ways to downsize the company by abolishing several posts that have been rendered redundant following technology advancements. The board is engaged in an internal study to ascertain how many posts can be shelved after the retirements due in 2022-2023.
According to the board, 27% of KSEB’s revenue is spent on employee cost against the national average of 15% in the power sector. If the employee cost is not reduced significantly, it could push KSEB into a financial crisis in the 2024-25 period itself.
“The receipts from retention of (electricity) duty allowed by the state government till March 2024 is barely meeting the commitment of pensions of former KSEB employees and subsidies directed by the government as per Section 65 of the Electricity Act 2003. The non-payment of electricity charges by the Kerala water authority is also mounting despite the state government taking over the payment of bills as per the non-plan. At present, the arrears of KWA is Rs 996.9 crore (excluding interest). All India average in the power sector for employee cost is reportedly 15%, and as such reduction of 7% to 10% minimum will be immediately required to bring the company into the comparative operational economy,” said a board order on the study for restructuring.
KSEB claims that if the government ceases electricity duty if not continued to be allowed to KSEB, there would be an acute shortage of funds from the financial year 2024-25, and pension disbursals may get affected.
“The employee strength and expenditure, therefore, need to be kept in strict vigil and control, and reasonable savings have to be effected through reducing avoidable recruitment to regular posts where technology savings are possible, especially in transmission and distribution,” the order said.
The possibility of automated centrally controlled operations in generating stations, substations and smart meter related savings in the distribution network has to be effected for the next five years by further innovating on the board of directors' recommendations regarding restructuring.
After holding discussions with stakeholders, the committee is expected to prepare its first report by June 5, 2022.