The non-payment of subsidy has created serious financial trouble for PSPCL and the financial constraints have already been reflected in the shortage of essential materials, delayed payments to suppliers and contractors, and thus hindering the development works.
This has been stated by the power engineers association to the state government as well as the Chairman cum Managing Director Punjab State Power Corporation Limited (PSPCL).
In a letter to PSPCL CMD and state government officials the PSEB Engineers Association claimed that due to non-payment of subsidy etc, regular development works and new generation plants are not being executed departmentally.
Due to financial constraints, PSPCL is unable to infuse equity in the new projects. Even the payments of retired employees have been delayed.
PSEBEA general secretary Ajaypal Singh Atwal said that PSERC has worked out Rs 17,800 crore as subsidy for the current financial year and about Rs 10,284 crore was payable by the end of October 2021.
However, only Rs 5,647 crore has been paid and the defaulting amount as of today is Rs 4,637 crore.  

Arrears of defaulting consumers to the tune of Rs 1,500 crore and is contemplating to implement the reduction in tariff resulting by further loss of Rs 3,300 crore more on the instructions of the Punjab government.
Further, the power bills amounting to around Rs 2000 crore of the state government departments are also pending.
Atwal said that the decision of PSPCL management to allow this new subsidy of Rs 4,800 crore which is not part of the tariff order, without the approval of PSERC regarding the manner of payment of subsidy, is a serious violation of the Electricity Act 2003.
He said the tariff was based on the ARR of PSPCL and the commitment of the Punjab govt to provide subsidy to various sections of consumers.