Special Correspondent

KSERC cites 2003 Act

Electricity Act does not favour widening cross-subsidy

Stakeholders say government should subsidise KWA

THIRUVANANTHAPURAM: The Kerala State Electricity Regulatory Commission (KSERC) has rejected a petition filed by the Kerala State Electricity Board (KSEB) in July seeking to rationalise the electricity tariff in the State for raising an additional revenue of around Rs.150 crore annually.

The KSERC, in its order issued on Wednesday after public hearings and other mandated procedures, rejected the long list of tariff adjustments proposed in the petition generally on the ground that the Electricity Act of 2003 did not favour widening the cross-subsidy element in the tariff structure. Some of the proposals in the petition had this element.

The main proposals in the petition included the introduction of non-telescopic tariff for domestic consumers, 15 and 20 per cent increases respectively in demand charge and energy charge for High Tension commercial consumers, 25 per cent increase in tariff for bulk supply to licensees and a reduction of 10 per cent in the tariff applicable to the Kerala Water Authority.

Domestic rates

For the domestic consumers, the KSEB had proposed retaining the existing tariff for those who use up to 200 units of electricity a month, while doing away with the present telescopic tariff system for the high-end consumers. In other words, the proposal was for a flat rate for the entire energy used by the high-end consumers, instead of the present system of the rates changing at different levels of consumption for the same consumer using more than 200 units a month. The KSEB had hoped to raise Rs.69.47 crore annually through this proposal.

Through the proposal for increasing the demand charge and energy charge for High Tension commercial consumers, the KSEB’s expectation was to raise an additional annual revenue of Rs.58.94 crore. Several groups of commercial consumers deposed before the KSERC that it would make some of the units close shop.

The KSEB’s contention was that a wide disparity now existed between the tariffs applicable to Low Tension commercial consumers and High Tension commercial consumers, the average tariff for the former being Rs.8.12 a unit and that for the latter 4.81 a unit.

Regarding the proposal for bringing down the tariff for KWA installations, several stakeholder groups took the position that it was up to the government to subsidise the KWA and not the KSEB.