Rejecting the power tariff hike proposal of UT Electricity department, the Joint Electricity Regulatory Commission (JERC) has come down heavily on the UT department for furnishing incomplete expenditure details and discrepancies in annual estimated revenues.
The JERC has rejected the Electricity department proposal of power hike stating that there is a surplus of Rs1.57 crore and there is no need of power tariff hike.
The JERC order reads, “The petitioner (UT Electricity department) has proposed 48.68 per cent increase in average tariff on the existing tariff, for financial year (FY) 2013-14. Keeping in mind the approved Aggregate Revenue Requirement for FY 2013-14 and reviewed gap of FY 2012-13, the Commission is of the view that there is a surplus of Rs1.57 crore, so there is no need to revise the tariff.”
The Commission has noticed discrepancies in the actual revenue furnished by the UT for 8 months of FY 2012-13 with the estimated revenue for FY 2012-13 submitted in ARR & Tariff Petition for FY 2013-14. The Commission has observed that UT did not make any long-term PPA (power purchase agreement) to meet its base requirement and depends largely on short term power purchases to meet the present shortages. It purchases power at higher rate from other sources, power exchanges and over drawls under UI beyond prudent levels.
The Commission has also directed the UT Electricity department to pay the interest on consumer security deposit for FY 2013-14 (at the bank rate ie 8.75% per annum applicable as on January 2, 2013) with effect from April 1, 2013 to the consumers on their security deposit, irrespective of UT’s constraints.
The order further reads, “The Commission is of the view that the expenditure as claimed under the various heads (RoE, Depreciation, Interest & Finance Charges and GFA) are on assumption basis. So, till such time the Department prepares and maintains the asset and depreciation registers and get them duly audited, it is not feasible for the Commission to consider carrying costs in accordance of Provision 4 of Regulation 8 for ‘Review and Truing Up’ of JERC Tariff Regulations, 2009.”
The Commission also observed typographical error in the capital expenditure submitted by the UT. The UT department submitted capital expenditure for the FY 2012-13 — Q1: Rs115.54 crore, Q2: Rs819.59 crore. On this, JERC pointed out that a typographical error has been observed and it should be in lakhs.