Question power tariff hike when CAG audit of discoms’ accounts is pending; demand Sheila’s resignation

In the end the discoms got more than what they asked for. When the DERC announced the revised tariff hike on Tuesday, the discoms walked away with not just a hike in current rates, but also a means to address their accumulated deficit. The DERC on Tuesday said what the discoms have been saying all along, that they have been pushed to the brink in the absence of a tariff revision over the years.

While the discoms were happy to have DERC acknowledge their demands, the hike, which is the highest for the domestic category consumers, has drawn sharp criticism from consumers as well as political parties.

The residents’ welfare associations were by far the most critical. The RWAs that have been protesting against the previous hikes and had petitioned the DERC and the Delhi Government for audit of discoms’ accounts have demanded a rollback of the hike. They also demanded the resignation of Delhi Chief Minister Sheila Dikshit for “helping the discoms”.

“DERC which has been set up to look into and regulate the problems and complaints of consumers in league with the Delhi Government seems to be working full time for the benefit of private discoms. On slight pretext and representation DERC increases the power tariff on the basis of farce papers and reports submitted by the discoms. Similarly the Delhi Chief Minister steps in to fully endorse the increase,” said East Delhi RWA Federation president Anil Bajpai.

V. N. Bali of Ram Vihar RWA said: “The Delhi Government led by Ms. Dikshit is unaware of the problems confronting the people or it has been sold out to the private power distribution companies. The RWAs had been fully opposing the earlier power tariff hike till a full CAG audit is done of the accounts of private distribution companies. The Government, by raising prices of every day commodities and utilities, is depriving people of their right to live.”

Delhi Chief Minister Sheila Dikshit who drew flak from consumers for her alleged “pro-discom comments” refuted the allegations and said as an independent entity the DERC is authorised to decide power tariff. “It has been organising public hearing to assess views of all stakeholders including discoms and RWAs prior to deciding the new tariff. The Government has yet to receive an official communication on the new power tariff. The Government will look into after it receives a copy,” she said.

She also said inflation and price rise are an “international phenomena” and that “incomes have also gone up side by side”.

The Chief Minister’s comments notwithstanding, Delhi BJP president Vijender Gupta has demanded an enquiry by an impartial and independent agency into the decision of a power tariff hike. He said the power companies, the DERC and the Delhi Government were trying to take advantage of load-shedding. “Now, on the pretext of power shortage, separate rates of tariff will be recovered from the consumers for peak hours and non-peak hours. The companies have already inflated the power bills three times by installing fast reading electronic meters. The power companies are also charging for increased load from the consumers,” he said.

The National Federation of Indian Women (N.F.I.W.) Delhi State Council also condemned the hike. The organisation was also critical of the fact that despite requests from consumers, there has been no audit of the discoms’ account by the Comptroller and Auditor General of India.

“The N.F.I.W. demands that all the three firms be brought under the purview of the RTI Act so their deeds and logic of increasing prices of electricity again and again can be exposed,” said N.F.I.W. general secretary Rachpal Kaur.

The Communist Party of India Delhi State Council blamed the Delhi Government and the DERC for permitting the three power distributing firms to claim a sharp increase in the tariffs.

The discoms for their part are relieved by the DERC’s orders. “It is imperative that people acknowledge that there was a mistake and that in the absence of a tariff hike, the discoms had to face severe financial crunch,” said a discom official.

“It would take some time to analyse the full impact of the said changes announced by the DERC. The increase would be used to meet the power purchase cost, which has been rising in the recent times. The surcharge allowed by the regulator for partial recovery of past gaps will be used to meet the accumulated gaps which is putting a huge burden on both the consumer and also affecting the debt-raising capacity of the discoms; the gradual liquidation of the same has become critical to ensure that discoms are able to raise adequate financing for continued reliable supply of power to consumers,” said a TPDDL spokesperson.

BSES for their part said the hike is a “welcome step towards cost reflective tariff”. “While the bulk power costs have risen by around 300 per cent (Rs.1.4 to over Rs.5 per unit)in the last 10 years, the retail tariff has increased by a mere 36 per cent. This virtually stagnant tariff has led to a huge build up of future receivables (regulatory assets) to the tune of nearly Rs.20,000 crore, impacting the sustainability of operations for the Delhi discoms,” a BSES spokesperson said.

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