It remains to be seen how the regulator will factor in these expenses and not allow power tariff to escalate. Chief minister Sheila Dikshit had recently said factors like increased cost of power production and no tariff revision by Delhi Electricity Regulatory Commission in the last four years should be considered while determining tariff for 2011-12.
The discoms, which for long had been saying tariff in Delhi was not cost-reflective and they were incurring huge losses, were vindicated by the Apellate order last month. The July 12 order which was largely in favour of discoms BSES Rajdhani and BSES Yamuna could have a cascading effect on the new tariff announcement to the tune of over Rs 2,200 crore recoverable by the two power companies from consumers. The discoms had challenged the May 23, 2009 tariff order of DERC on 13 points; ATE ruled in their favour on 11 counts. The tribunal, which was of the view that DERC's assumptions were based on verbal enquiries rather than actual facts, pulled up the regulatory body for making unrealistic assumptions while framing a tariff order for Delhi in 2008-2009.
"The state commission is expected to make a realistic assessment of the power purchase quantum. Any large deviation due to incorrect assessment as made in this case is going to create a revenue gap, and may result in cash flow problems for the distribution company," said the tribunal in its order.
DERC officials have stated that the new tariff (2011-12) will be based on current petitions and market rates. "Public views will be fully incorporated while determining the new tariff but at the same time we have to take into account factors like gas or coal price which are not in our control. These things are easily verifiable by any source," said officials. They said CAG audit of discoms' accounts - long demanded by power companies - had to be looked into by the central government and the commission had no role in this, though they supported an audit. The four-day hearing held last month on tariff determination brought to light many grievances like 'fast' meters and discoms' poor response systems.
DERC has also hinted that differential tariff may be introduced for commercial/industrial categories but not for domestic consumers. "Domestic consumers have opposed differential tariff in the hearing. But we are looking at introducing it for the industrial category. They will gain by receiving cheaper power at lean hours. Consumers have also asked us to abolish fixed charges and we are looking into it," said an official.
Source- Times of India