Consumers will pay the price for Sharavathi breakdown

Consumers will be paying the price for the shortfall in power generation due to the fire at the Sharavathi Generating Station. The breakdown of the station, resulting in procurement of high cost power accounting for about five paise per unit was among the reasons listed by the Karnataka Electricity Regulatory Commission (KERC) for the steep hike in tariff, effective April 1.

Curiously, the fire occurred in the station during mid-February, much after the electricity supply companies (Escoms) filed their tariff revision petitions.

In fact, power purchase was accounted for as a big factor for the power tariff hike. Speaking at a press conference after announcing the revision in tariff here on Wednesday, KERC Chairman M.K. Shankarlinge Gowda said that the increase in power purchase cost due to additional coal cess levied by the union government (eight paise per unit), and increase in power purchase cost due to addition of new sources of power (15 paise per unit) also contributed to the hike in tariff.

In addition, recovery of past regulatory assets (described as what the power companies asked for, were not given, but are entitled to) worth Rs. 1,105 crore, accounting for 20 paise per unit, has also been cited as a reason, given that the New Tariff Policy announced by the Union government does not allow for a carry forward of regulatory assets from the next financial year.

Despite the Commission, having advocated for long-term power purchases in the past, it has now decided to continue with the price cap of Rs. 4.50 per unit for the Escoms to procure power on short-term basis. “The Commission has observed that due to shortage of power in the State, Escoms are required to procure power on a short-term basis,” the commission noted.

Even the transmission tariff payable to the Karnataka Power Transmission Corporation Ltd (KPTCL) has been revised to Rs. 1,27,400 per MW per month, against the existing Rs. 1,12,079 per MW per month.

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Printable version | Sep 20, 2020 7:30:36 AM |

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