The Telangana power utilities were yet to finalise the gap in revenue requirement for the next year notwithstanding the government’s decision to offset the costs of the power utilities by taking over their loans.
The utilities have not included the revenue deficit, an important component, in their aggregate revenue requirement proposals submitted to the TS Electricity Regulatory Commission pegging the revenue requirement at Rs. 31,930 crore. They have not included the likely deficit as it involved factoring in various issues, including distribution and transmission costs as also the employee costs and have sought time from the regulator to file the details of the likely expenditure on this count separately.
However, it is anticipated that the gap would be significantly reduced in the coming days consequent to the State government’s decision to join the Ujwal Discom Assurance Yojana (UDAY) of the Central government wherein the debts incurred by the utilities over a period of time amounting to Rs. 8,923 crore would be taken over by the government.
This would amount to a net saving of over Rs. 800 crore for the utilities as there would be no debt servicing component in their tariff proposals.
Asked about the likelihood of tariff hike next year to bridge the gap in revenue requirements and likely deficit, a senior official said much would depend on the subsidy to be given by the government. The government had sanctioned Rs. 4,385 crore towards its subsidy to the power sector enabling the utilities to cope up with their deficits.
“It all depends on the subsidy extended by the government. There is no firm decision about the quantum of subsidy that will be provided to the utilities this time around so far. The utilities can arrive at a decision on whether or not to propose tariff hike based on the announcement of the subsidy,” the official told The Hindu .
