Sheila backs discoms’ plea to regulator for tariff hike

Chief Minister Sheila Dikshit has thrown her weight behind private power distributing companies (discoms) in their demand for a hike in electricity tariff.

Chief Minister Sheila Dikshit has thrown her weight behind private power distributing companies (discoms) in their demand for a hike in electricity tariff.

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The Delhi government on Tuesday asked power regulator Delhi Electricity Regulatory Commission (DERC) to keep the tariff determination process, on hold and respond to matters related to severe financial constraints claimed by discoms.

The government invoked Section 86 of the Electricity Act, which allows it to seek DERC’s advice on police matters related to public interest. The government could also invoke 108 of the same act, which gives it overriding powers on DERC in public interest.

“Discoms had said they have no money to sustain operations. We have asked DERC to consider it and advice us,” said Delhi power Secretary Rajendra Kumar, reiterating “tariff was still the DERC’s prerogative”.

The three discoms — BSES Yamuna, BSES Rajdhani and North Delhi Power Limited — have been demanding return on investment made in financial year 2009-10 saying it was an exceptionally expensive year for them. By rule, they should get this return next year.

But discoms have convinced the government they do not have the money to buy power.

Hindustan Times had reported on this issue on March 18.

“The DERC was giving us Rs 2.55 per unit as return on power purchase cost. But last year we ended up spending Rs 3.68 per unit,” said a discom official.

Sources said the DERC had, in principle, agreed to devise a way by July 1 to let discoms recover extra cash outflow, such as additional payment of power and fuel cost every quarter so shortfall does not arise again.