The power tariff hike by ₹1.48 per unit across all consumer categories, sought by Chamundeshwari Electricity Corporation Ltd. (CESC), evoked opposition from stakeholders from industries, members of chambers of commerce, farmer organisation and individual consumers.
At a public hearing by the Karnataka Electricity Regulatory Commission (KERC) here on Wednesday, CESC Chairman D. Kiran made a presentation justifying the hike and projected a net loss of ₹962.93 crore for 2017-18.
The droughts had affected hydro-power production which contributed to 40% of the total energy demands of CESC and the deficit in power generation was compensated by power purchased at a higher cost, he said.
The gap between the cost of power purchased and the cost of supply has to be bridged to reduce this deficit and the consequent loss, said Mr. Kiran.
Besides, the cost of supply too has escalated over the years from ₹2,525.71 crore in 2012-13 to ₹2,7323.67 crore as on December 31, 2016, he added.
The deficit pertaining to the average cost of supply per unit was projected to increase from ₹0.85 in 2015-16 to ₹1.48 during 2017-18 and the average cost of supply was more than the average rate of realisation, according to CESC.
In addition, the CESC also proposed to increase the fixed tariff across all consumer categories.
But stakeholders picked loopholes in the CESC justification for the hike and KIADB Industrial Area Manufacturers’ Association (KIAMA) vice-president K. Ravindra Prabhu described the proposed hike as unscientific, anti-industry and unjust.
He argued that the State government had passed on the burden of pension and gratuity liability to the tune of ₹282.63 crore besides carrying forward the loss of 2016-17 to the tune of ₹456.54 crore on CESC.
He said that the government was also not reimbursing funds to the tune of ₹116.21 crore which had forced the CESC to be a loss-making corporation and had forced it to file a petition seeking an upward revision of power tariff.
Suresh Kumar Jain of Mysore Industries Association (MIA) said the SSI units would be crippled as they were already reeling under the impact of demonetisation and the consumption of power units had fallen underlining the precarious state of industries in the region. MIA also wanted the government to end the practice of passing on the burden of cross-subsidisation on industries and sought tariff to be fixed at the actual cost of purchase to the industry.
KERC Chairman M.K. Shankarlinge Gowda and members, D.B. Manivelu and H.D. Arun Kumar, were present.
