The Hindu : Karnataka / Bangalore News : Escoms seek 20 p.c. raise in tariff

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Wednesday, Jul 01, 2009
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Karnataka

Karnataka - Bangalore

Escoms seek 20 p.c. raise in tariff

Bangalore Bureau

The revised tariff is likely to come into effect from January 2010 if KERC accepts the plea

Escoms incurring loss of Rs. 1.13 for every unit of power sold
KERC urged to regard the remaining deficit as ‘regulatory asset’

BANGALORE: All the five electricity supply companies (Escoms) in the State on Tuesday filed separate tariff revision petitions before the State power regulator seeking a tariff increase of 51 paise a unit across the board. This amounts to an increase of 20 per cent over the present tariff.

Karnataka Power Transmission Corporation Ltd. too filed a tariff revision petition seeking a increase in transmission tariff from 19.42 to 29.64 paise a unit.

The increase in tariff has been sought for all the consumer categories. If the petition is accepted, the Government will have to increase the provision for subsidy correspondingly to ensure free power to irrigation pumpsets, Bhagya Jyothi and Kutir Jyothi consumers.

Additional revenue

The Escoms are planning to net an additional Rs. 1,800 crore from the revision to partially bridge their combined revenue deficit of Rs. 3,900 crore – highest deficit ever in State’s power sector.

K. Jairaj, Principal Secretary, Department of Energy, told presspersons on Tuesday that the proposed increase was expected to come into effect from January 2010.

As per the Karnataka Electricity Reforms Act, the Escoms and KPTCL can only make a tariff revision proposal to the KERC.

The commission would take a decision on the issue after consulting the stake holders, including consumers through public hearings. The commission has four months to examine the plea.

The last tariff revision exercise was undertaken on January 11, 2008 when the KERC had effected a marginal reduction.

However, that tariff order was not implemented as it was mired in litigation.

Mr. Jairaj said the need for seeking a tariff revision had arisen as Escoms were incurring a loss of Rs. 1.13 paise for every unit of power sold by them because of the increase in the costs of maintenance, operation, renovation and modernisation works.

Increase trimmed down

According to sources, the Escoms would have been able to fill the entire revenue deficit if they had sought an increase of 92 paise a unit.

As the power utilities had sought a raise of 52 paise per unit, they requested the Commission to consider the remaining deficit amount as “regulatory asset” and to carry it forward so that it could be bridged later.

Mr. Jairan said all Escoms had been instructed to improve efficiency level and reduce energy losses from 22.3 per cent in 2009 to 15 per cent in 2013, he said.

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