KERC to issue order on escoms’ petitions today

The State power regulator is set to issue its tariff order on Thursday on petitions filed by all the five electricity supply companies (escoms) seeking a revision in tariff.

According to sources, the average power tariff is expected to be broadly in the range of 20 to 25 paise a unit though it may be slightly higher for some consumer categories.

The escoms had filed separate tariff petitions before the Karnataka Electricity Regulatory Commission (KERC) on December 10 last year seeking an average hike of 70 paise a unit for all consumer categories barring irrigation pumpsets below 10 hp and Bhagya Jyothi and Kutir Jyothi consumers to bridge a revenue deficit of about Rs. 2,232 crore.

The KERC has held a series of public hearings on the tariff hike petitions besides examining official records and analysing the financial position of the escoms.

5th revision 42 months

The ongoing tariff revision exercise has caused concern in the power sector as the State has already witnessed four tariff hikes in the last three and a half years, starting from November 2009. The State has not witnessed such frequent tariff revisions in this span of time before. The last revision was effected in April 30, 2012 when the tariff was hiked by an average 13 paise a unit. The KERC granted a hike of 28 paise a unit in October 2011, 23 paise a unit in December 2010 and 34.16 paise a unit in November 2009.

The ongoing tariff revision exercise has become a sensitive issue for various reasons, including the possibility of it having a political impact as Assembly elections are to be held on May 5. Besides, the revision is being taken up at the beginning of what appears to be a blistering summer marked by load-shedding in most parts of the State, especially in rural areas, to make up for power shortage. Industries have been opposing tariff revision by pointing out that they are yet to recover from the global economic slowdown.

On the other hand, the financial position of all the escoms in the State is deteriorating on account of the huge revenue deficits arising mostly form the purchase of high-cost power to tide over the shortage. Poor hydel storage and increasing demand for power have added to the woes of the escoms.

In fact, taking serious note of the mounting revenue deficit of the escoms, the State Budget presented by Chief Minister Jagadish Shettar announced the constitution of an expert committee to suggest ways of improving their financial health.