Domestic consumers are to get some relief from their possible commitment to pay additional deposit amount with the Tamil Nadu Electricity Regulatory Commission (TNERC) hiking interest rate on security deposit of consumers lying with the Tamil Nadu Generation and Distribution Corporation (Tangedco).
The relief will come in the wake of the Commission determining the interest rate at nine per cent as against six per cent hitherto.
It has been the practice of the power utility to credit the interest amount to the security deposit accounts of consumers.
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In other words, there is no cash payment by the utility to consumers.
As the adequacy of the security deposit amount is due for review by April this year, the increase in the interest rate will mean that the consumers may have to pay less towards security deposit even it goes up.
For domestic consumers, the security deposit amount is maintained at one and a half times the average power bill. For the purposes of calculation, the Tangedco takes into account six bimonthly bills raised during the preceding financial year and arrives at the average value of the power bill.
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The TNERC has arrived at nine per cent for the interest rate as the weighted average bank rate is about nine per cent for the period from April 2012 to January 2013.
For the Tangedco, the upward revision in the interest rate means that the power utility has to set apart about Rs. 100 crore more towards its liability of interest payment, which is only notional. At present, the annual liability is around Rs. 320 crore.
The Commission’s order also states that the interest rate on meter caution deposit will be nine per cent.
There are about 1.5 crore domestic consumers with an annual increase of five to six lakh consumers on an average.