In the wake of Chief Minister Sheila Dikshit’s letter to the Reliance Group chairman about certain shortcomings in power distribution threatening to derail the reform process, BSES Rajdhani and BSES Yamuna chairman Lalit Jalan has assured her that the discoms, despite facing a financial crunch, would be purchasing sufficient power to meet the high demand during the coming summer months.
Mr. Jalan, who met Ms. Dikshit, told The Hindu that the recent advisory of the Delhi Electricity Regulatory Commission to the Delhi Government spelt out the position of the sector in a very succinct manner. He said the hard fact was that since there were no tariff hikes for 5-6 years and cost increases kept taking place, the discoms were now finding it difficult to clear the dues of the generating companies.
He said earlier banks used to lend but they too are no longer willing to do so without State guarantees. “Operationally the discoms have done very well and Delhi is now only the second city to have 24x7 power supply. The sales of generators and inverters have fallen 95 per cent.’’
Acknowledging that the Chief Minister had expressed concern at the unplanned outages in the month of January, Mr. Jalan said it was explained to her that in some areas, particularly in North-East Delhi, the transmission constraints were the root cause of this problem.
As for the issue of the discoms failing to meet the Aggregate Technical and Commercial loss targets in the year 2011-12, he said these targets had been met in nine of the last ten years. “They are also unrealistic and the matter is sub judice as it has been challenged before the Appellate authority.’’
At a time when there is immense financial pressure on the discoms, Mr. Jalan said the main concern of the Chief Minister was the supply for the next fiscal, particularly the harsh summer months. “We have convinced her that we have planned things out based on reasonable growth assumptions and the performance of the generating stations and the quality of power supply would be ensured.’’
On whether finances would come in the way of implementation of these plans, the BSES official said in Delhi most of the power is purchased from the government generating agencies with 70 per cent coming from the NTPC at rates determined by the Central Electricity Regulatory Commission and 15 per cent from Delhi’s generating units at rates fixed by DERC. “We cannot ask them to reduce the rates and if the cost of power is x, then we cannot sell for less than that too.’’
However, he said if there is some clarity from the DERC on the issue of tariffs, then probably the lending institutions would be more inclined to help Delhi out with its purchases. Noting that the total revenue gap of the discoms in Delhi was not nearly Rs.20,000 crore, Mr. Jalan said the question is “who is going to fund it? Initially we were able to borrow, but no longer so”.
“We have come to a point where we have to be cost reflective and work towards liquidating our arrears,’’ he said, noting that in such cases State support can help ease the burden. In this regard, he said the discoms are now waiting for the recommendations of the Power Department. Implementation of measures suggested by CERC for nominal tariff increases every year and power cost increases on a monthly basis could help overcome such situations.