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Home News Power Sector News State Subsidy : OERC allows special power tariff rebate

State Subsidy : OERC allows special power tariff rebate

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OrissaThe Orissa Electricity Regulatory Commission (OERC) on 18-06-2011 allowed a special rebate of Rs 1.50 per kilo watt hour for consumption above 50 units subject to a maximum rebate of Rs 75 per month following an assurance from the Government to provide subsidy. However, the order of the commission is subject to the outcome of the writ petition pending before the Orissa High Court. The High Court had on May 9 directed the regulatory commission to dispose of the review petition of the State Government by June 19.

While dismissing the review petition of the State Government on the ground that it is prima facie not maintainable, the regulatory body initiated suo motu proceedings on the basis of the reply submitted by the petitioner on June 16.

"Since the State Government has expressed its intention of giving subsidy to compensate for the loss of the distribution companies on account of reduction of tariff for domestic consumers from Rs 3.50 per unit to Rs 2 per unit (for consumption of 51 to 100 units per month), the case is taken up for consideration under Section 65 of the Electricity Act, 2003," the order said.

Putting the number of domestic consumers at 12 lakh as against the commission's estimate of 33 lakh, the Government estimated the� consequential loss to the distribution companies at Rs 108 crore in case the tariff rate in the second slab is reduced to Rs 2 per unit from the existing Rs 3.50 per unit.

* The Government assured the OERC, through an affidavit, that it will compensate for the loss of the distribution companies by reducing the bulk supply tariff of Gridco by 5 paise per unit and make good the loss of the State utility by providing a share capital of Rs 108 crore.

* As per the commission's estimate, the total loss of the distribution companies will be to the tune of Rs 244 crore.

* The OERC order will come into effect from April 1. The operation of the new tariff order of the commission, passed on March 18, has been stayed by the High Court.

Source- IBNLive


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