Delhi - Private Discoms demand another tariff hike.

Political parties may have used power tariff reduction as the main agenda for their election campaign, but Delhiites must get ready for another hike in electricity prices in the new year. Private discoms-BSES Rajdhani, BSES Yamuna and Tata have sought tariff hikes of 2-7% as per Power Purchase Adjustment Cost, to be applicable from January to March 2014. The petitions have been sent to Delhi Electricity Regulatory Commission which is likely to pass an order before the month-end.Following guidelines laid down by Appellate Tribunal of Electricity, periodic power purchase adjustment is allowed to discoms-for expenditure incurred in power purchase and increased generation costs over and above what has been allowed to them in the tariffs.

DERC introduced the provision of fuel adjustment in the tariffs of 2012-13 and then changed it to overall power purchase in the latest tariff announcement in July this year. PPAC will be implemented from January 1 to March 31, 2014 and cover the increased expenses incurred by discoms from July 1 to September 30, 2013. This is the first time discoms have sought PPAC separately. BSES Rajdhani has sought a 3% hike, Tata Power Delhi a 2% hike and, while east Delhi discom BSES Yamuna initially sought a 7% tariff hike, DERC sources indicated it scaled down BYPL's PPAC hike to 3%.

"We adopted a formula for periodic PPAC adjustment after the ATE directive. Based on this, BYPL's petitioned hike has been reduced because the discom included heads not covered by the formula," revealed a DERC source. In the 2013-14 tariff order issued in July, PPAC for the last quarter had been merged with the tariff order. "PPAC is given only when discoms incur additional costs not covered in tariff. The claims will be verified," said chairperson P D Sudhakar. Discoms so far have been regular in petitioning for fuel surcharge earlier and PPAC lately, but sources said a pending regulation that could reduce NTPC generation costs and discoms might eliminate PPAC in the next quarter. "We will know only when the proposal is finalized," Sudhakar said.

Source- Times of India