Delhi chief minister Arvind Kejriwal on 31-12-13 announced a 50% cut in electricity tariffs for households consuming up to 400 units of power per month, fulfilling a second key electoral promise since the Aam Aadmi Party (AAP) assumed office in the national capital three days ago.
The decision, which will benefit 2.8 million households, follows the announcement on Monday that households with a metered water connection in Delhi will get 20 kilolitres of water a month free of charge from 1 January.
The AAP government on Tuesday also asked the Comptroller and Auditor General to audit the performance of Delhi's power distribution utilities, or discoms, such as North Delhi Power Ltd (NDPL), BSES Yamuna Power Ltd (BYPL) and BSES Rajdhani Power Ltd (BRPL).
"People demanded it and now these companies will be audited for the first time. Discoms have to give their objection on audit by tomorrow," Kejriwal said on Tuesday evening.
The cut in electricity tariffs, part of the AAP manifesto for the 4 December state assembly election, will entail a cost of Rs.61 crore over next three months. Kejriwal said a further cut may be ordered after the audit.
Kejriwal said the Delhi government will provide the subsidy and the money will be directly paid to the distribution companies. Spokespersons for BSES and NDPL declined to comment.
"The tariff is already in place and has to be realized by the distribution companies (discoms)," P.D. Sudhakar, chairman of the Delhi Electricity Regulatory Commission, said.
"While the government has announced a subsidy towards the discoms bill, which will be given to the discoms, the rest has to be realized from the customer. We have no role to play."
The regulator recently rejected a tariff increase sought by the distribution utilities. NDPL, BRPL and BYPL have a consumer base of 4.231 million customers.
The AAP made a stunning debut in the Delhi assembly elections, winning 28 seats in the 70-member House in its poll debut. The Bharatiya Janata Party was the single largest party with 31 seats in the assembly, but didn't stake a claim for forming the government.
The AAP is dependent on the support of the Congress party's eight state legislators for staying in office.
Delhi's power purchase cost has spiked since 2009 with the distribution utilities incurring losses in power trading. It is estimated that the utilities suffered a loss of Rs.900 crore in 2011-12 due to inaccuracies in demand forecasting and a fall in the rate of sale of power in the short-term market nationally. Delhi's power demand is in the region of around 5,000 megawatts.