On May 7, 2025, the Kerala State Electricity Board (KSEB) announced a new initiative aimed at addressing the substantial issue of long-pending power bill arrears among consumers. The new one-time settlement scheme, dubbed OTS-2025, is designed to help consumers clear their outstanding electricity dues, which have accumulated to a staggering ₹2,164.06 crore as of December 31, 2024.
The OTS-2025 scheme will be open for applications until July 31, 2025, and it specifically targets arrears that are older than two years. However, it notably excludes cases involving theft as defined under Section 135 of the Electricity Act, 2003. This exclusion is intended to ensure that the scheme focuses on genuine cases of overdue payments rather than those involving illegal consumption.
Under the new scheme, consumers can benefit from significantly reduced interest rates on their outstanding bills. The KSEB has structured the interest rates to encourage timely payments: for arrears that have been outstanding for more than ten years, no interest will be charged; for those between five and ten years, the interest rate is set at 4%; and for arrears older than two years but less than five years, the interest rate is 6%. This tiered approach aims to incentivize consumers to settle their debts while easing the financial burden of accumulated interest.
In addition to the reduced interest rates, the KSEB is offering a rebate of 5% on the principal amount for consumers who choose to remit the entire principal and the total reduced interest in one lump sum. This financial incentive is expected to motivate many consumers to clear their dues promptly.
The urgency of this initiative stems from the KSEB’s ongoing struggle with rising arrears. Previous efforts to address this issue through a similar scheme, which was implemented from July 2023 to December 2023 and later extended to March 31, 2024, yielded ₹41.46 crore in total recoveries. This included ₹30.58 crore in principal and ₹10.88 crore in interest. Despite these efforts, the accumulation of unpaid bills has continued to be a cause for concern.
As the KSEB noted in its guidelines for OTS-2025, a substantial portion of the pending arrears is tied up in litigation across various courts, complicating recovery efforts and further exacerbating the board's revenue challenges. The board emphasized that these arrears represent amounts that may be practically unrecoverable through lawful means, highlighting the need for immediate action.
In a broader context, the KSEB's announcement comes at a time when the state government is also focusing on educational initiatives for children of migrant workers. On the same day, the Kerala government launched the 'Jyothi' program, aimed at ensuring that children from these families receive a quality education. This initiative underscores the government's commitment to addressing the needs of all citizens, particularly those from vulnerable backgrounds.
In a related development, the KSEB also warned consumers about the consequences of non-payment of electricity bills. On May 7, 2025, at 08:25 PM, the board announced that action would be taken against those who fail to settle their outstanding dues. This statement reflects the board’s determination to enforce compliance and ensure that all consumers contribute their fair share towards the maintenance of the electricity supply.
The KSEB's efforts to clear the backlog of power bill arrears and improve its financial health are crucial not only for the board itself but also for the overall stability of the state's electricity supply system. As the board works to provide electricity to all consumers, these measures are essential in addressing the financial challenges posed by unpaid bills.
In summary, the launch of the OTS-2025 scheme represents a significant step by the KSEB in tackling the issue of power bill arrears in Kerala. By offering reduced interest rates and rebates for timely payments, the scheme aims to facilitate a resolution for many consumers struggling with outstanding electricity dues. The board's commitment to enforcing payment compliance further emphasizes the importance of financial responsibility among consumers.
As Kerala continues to address its energy needs and the challenges posed by unpaid bills, the KSEB's initiatives will play a critical role in ensuring a reliable and sustainable electricity supply for all residents.
