The attempt to use power subsidy to control groundwater extraction, as in Punjab, ignores certain ground truths.
Here is an overview of the concerns with groundwater use and the shortfalls with the Punjab model.
How is electricity a factor?
Groundwater overdraft is also linked to subsidised power supply to agriculture.
So, the mode of electricity pricing supplied to agriculture could be changed to control groundwater abstraction.
This can in turn help achieve the goals of efficiency, equity and sustainability.
The most frequently suggested instrument for controlling groundwater abstraction was the metering and pro-rata (proportional) pricing of electricity.
What is the Punjab model?
An idea which came from a prominent research group recently is direct delivery of power subsidy to agriculture.
It involves metering of agricultural power connections, but no metered tariff.
The idea is to make sure that farmers get free power.
But, the power utility reduces its subsidy burden gradually by incentivising the farmers to use less electricity.
It thereby saves both groundwater and electricity.
This model was adapted by the power utility of Punjab.
It involves offering cash incentives to well-irrigating farmers who use less than a designated quota of electricity each season.
The individual’s quota is decided on the basis of the connected load and the season.
E.g. for one HP of connected load, a farmer is entitled to 200 units a month during the kharif season and 50 units per month during the winter
The farmer gets a cash incentive of Rs. 4 for every unit of electricity saved.
What is the downside of this?
This pilot project implemented in 135 farms across Punjab has shown reduced electricity consumption by around 60% of the farmers.
However, nearly a third of the farmers had increased electricity consumption even after accepting the scheme.
Reason - In a given year, season and locality, the power demand will be a function of the cropped area and cropping pattern.
Fixing the quota is on the basis of connected load.
This can be said to be rational only if the farmers have correctly chosen the pump capacity.
They should have taken into consideration the actual quantum of energy required for irrigating farm and the number of hours that the power supply is available.
But this may not be the case in reality.
Possibly, many resource-rich farmers have chosen over-sized pumps.
In such cases, their energy quota will be much higher than what is required to irrigate the plot even at the current excessive levels of dosage.
The reason for maintaining the high-level of irrigation dosage is that it could be rewarding from an economic perspective, yield improvement.
The value of this is logically more than the economic incentive they get by saving water.
In effect, resource-rich farmers might keep their power consumption much below the ‘quota’ and claim cash incentive, but continue with inefficient irrigation.
On the other hand, a resource-poor farmer, who has a low-capacity pump might end up using the full quota of energy or even more.
What is the way forward?
Ideally, the ‘energy quota’ should have been fixed on the basis of the actual land holding cultivated by the farmer during a particular season.
It is this that determines the water and energy requirements for irrigation.
The point is that the current subsidy structure may not create any special incentive to save either electricity or groundwater in Punjab.
The irrigated paddy fields as well as rainfall contribute to the recharging of shallow groundwater during the monsoon season in alluvial Punjab.
So, besides regulating irrigation, addressing rainfall infiltration is also important.
Also, choosing a crop or variety with lower evapo-transpirative requirement is essential to conserve soil moisture.
All these require coordination among various departments - water resources, electricity and agriculture.
