Telangana Panchayats Face Crisis Over Rs 1,700 Crore Power Bill Arrears

HYDERABAD — Gram panchayats across Telangana are facing a financial crisis as mounting electricity dues of approximately Rs 1,700 crore threaten to consume Central development grants from the 15th Finance Commission. The Panchayat Raj Department instructed village secretaries to use these grants to clear the arrears, drawing strong opposition from newly elected sarpanches who warned the move would halt local development works.

The 15th Finance Commission grants were allocated for drinking water supply, sanitation, internal roads, drainage, parks, streetlights, and other civic infrastructure across the state's 12,760 gram panchayats. However, accumulating power bills for street lighting, water supply systems, Palle Prakruthi Vanams, nurseries, and sports grounds have created heavy financial liabilities. Depending on size, villages incur monthly electricity charges ranging between Rs 15,000 and Rs 30,000.

According to officials, electricity bills were regularly cleared during the previous BRS government. The current arrears accumulated after the Congress administration took office, driven by delays in holding sarpanch elections, fund shortages, and subsequent delays in the release of Finance Commission grants.

With distribution companies pressing for immediate payment of dues, the Panchayat Raj Department directed village secretaries to access available 15th Finance Commission funds through the digital key system. Officials warned secretaries of departmental action if payments face further delays. However, the directive has triggered friction at the local level, with sarpanches in several districts actively preventing secretaries from withdrawing the funds.

Panchayat Raj officials defended the decision, stating that electricity expenditure for essential services like drinking water supply and street lighting falls within the permissible guidelines of the Finance Commission grants. They pointed out that clearing the arrears was urgent due to higher power consumption for drinking water distribution, compounded by an ongoing water crisis stemming from poor rainfall and the El Nino effect. Without a long-term resolution, village development projects across the state risk coming to a complete standstill.