No power tariff hike proposed in UP, a decrease may be considered
The UPPCL chose not to propose any tariff hike despite the fact that it ARR projects a revenue gap of around Rs 8,000 crore at the prevailing tariff by the end of the current financial year.
Power consumers in Uttar Pradesh have been spared a tariff hike, going by the UP Power Corporation Ltd’s annual revenue requirement (ARR) petition that the state’s power regulator finally admitted on Tuesday.
People familiar with the matter cite the Lok Sabha polls, due to be held early next year, as the reason for the decision not to increase the tariff.
“On the contrary, we will examine if there is any scope for decreasing the tariff for domestic consumers in view of the falling power purchase cost,” said a senior official of the Uttar Pradesh Electricity Regulatory Commission, refusing to be named.
The UPPCL’s ARR petition proposes no tariff revision in any form at all for any category of consumers.
The petition was admitted following exchange of queries and answers several times over the last two months.
The proposal, which is valid for the current financial year ending on March 31, 2019, should have been filed in November 2017.
The UPPCL is supposed to file the ARR petition for the year 2019-2020 by the month end.
“The UPPCL has not demanded any tariff increase at all. So, we have asked them to service their possible deficit through their own means,” the senior UPERC official said. He said there was no question of the commission increasing the tariff on its own.
The UPPCL chose not to propose any tariff hike despite the fact that it ARR projects a revenue gap of around Rs 8,000 crore at the prevailing tariff by the end of the current financial year.
In the ARR, the UPPCL has shown it expenditures to be more than Rs 66,000 crore during the year against the energy billing or income of around Rs 58,000 crore.
“But the UPPCL appears to have projected its revenue gap on a higher side by showing certain things above norms. We may not allow their cash gap beyond Rs 3,000 crore or so,” said the official.
The projected income also includes Rs 8,900 crore subsidy from the government during the year.
The corporation had earlier proposed purchase of 1.18 lakh million units of power during the year, but has now compressed the same to 1.14 million units, apparently due to the demand not having increased as per expectations.
The UPERC, in its admittance order issued on Tuesday, has asked the UPPCL/discoms to publish the ARR proposal with all the details in the newspapers within three days of the commission’s order. The commission is expected to pronounce its order on the ARR by mid-December after holding public hearings.
The corporation filed the ARR only after the UPERC began suo motu proceedings on August 30, warning the corporation that it would revise the tariff on its own as mandated in the law if the UPPCL did not come out with a proposal.
The UPPCL, according to sources, feared that the commission might make a downward revision if it did not comply with its directions on ARR filling. “The UPPCL did file the ARR, but did not propose any tariff hike as the government did not favour the idea in the election year, more so when the corporation had got a hefty tariff hike only in 2017,” people familiar with the matter said.
