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TERI report presents rosy picture of power franchisee system in Agra

Power employees and consumer bodies are up in arms against the state government’s decision to replicate the Agra model in five more cities.

lucknow Updated: Mar 27, 2018 15:16 IST
Brajendra K Parashar
Brajendra K Parashar
Hindustan Times, Lucknow
TERI,Uttar Pradesh Rajya Vidyut Upbhokta Parishad,Comptroller General of India
“In overall terms, almost all of the sampled consumers gave 100 marks to the complaint redress mechanism of TPL in contrast to 40% satisfaction level prior to 2009.”(Representative image)

A policy research organisation’s report, which the Yogi Adityanath government has purportedly made the basis of its decision to privatise power distribution in Lucknow, Varanasi, Gorakhpur, Meerut and Moradabad, has presented quite a rosy picture of the performance of Torrent Power Ltd (TPL) in Agra, where the company has been distributing electricity as a franchisee for eight years.

Power employees and consumer bodies are up in arms against the state government’s decision to replicate the Agra model in five more cities.

In its study titled ‘Performance Assessment of Electricity Distribution Franchisee of Agra’, TERI has found the government’s decision to hand over distribution franchise to Torrent in 2010 as a win-win for the franchisee (TPL), the UP Power Corporation Ltd (UPPCL) as well as consumers.

The TERI, according to principal secretary, energy and UPPCL chairman, Alok Kumar, was asked to undertake a detailed ground-level assessment of electricity supply position and consumer service delivery in the franchisee area of Agra.

“It presented the report last month with a lot of positive feedback, encouraging the UPPCL to introduce a similar system in some other cities for larger public interest,” he said

In 2009, the UPPCL’s subsidiary Dakshinanchal Vidyut Vitran Nigam Ltd (DVVNL) made a Distribution Franchisee Agreement (DFA) with the Torrent Power Ltd to improve operational efficiency of power distribution system in Agra.

“TPL has carried out system strengthening and operational efficiency improvement through various initiatives like improved billing and collection mechanism, effective customer grievance redress mechanisms etc,” TERI claims in its report.

According to the study, capital expenditure to the tune of Rs 800 crore was reportedly made by TPL, during the first seven years of the operation. The augmented infrastructure, improved quantum of power supply and good operation and maintenance practices have resulted in meeting higher peak demand of about 425 MVA in 2016-17 as compared to about 381 MVA in 2011-2012.

The franchisee, the report says, brought down the distribution losses dramatically with the result that it is meeting the increased demand without an increase in additional power purchase suggesting a large amount of electricity that was being stolen earlier is now being to meet the additional demand.

The report points out: “While the electricity supply available to the TPL at input point by the DVVNL every year during the period 2010-11 to 2016-17 has remained around 2,100 MU (million units), the supply available to consumers over the years of operation of the franchisee has shown substantial rise from 1,025 MU in 2010-11 to about 1,560 MU in 2016-17 due to reduction in distribution losses from 51.5% to 25.5%,” the report says.

Similarly, the total consumer base in the franchisee area has increased from 2,87,697 in 2010-11 to 4,24,889 in December 2017 and the failure rate of distribution transformers has also reduced sharply from 24.6% to about 1.7%. during the period, it says.

The reliability indices, according to the study, have shown a drastic improvement. “The total number of complaints have also reduced drastically from 2,06,000 to about 13,000 between 2010-11 and 2016-17,” says the report.

The study further claims that significant improvement has been reported in meter reading efficiency, billing efficiency and collection efficiency from respective levels of 65.35%, 82% and 94% in 2010-11 to 96.4%, 99% and 97% in 2016-17. “As a result, Aggregate Technical and Commercial (AT&C) losses have reduced from 61.8% to 27.2% in the seven years of operation.

The TERI has, however, noted in its report that the AT&C losses have not attained the targeted level of 15% as per the distribution franchisee agreement for the year 2016-17.

The report also claims that public perception assessed through focused group discussion and one-to-one interactions with industrial, commercial and residential consumers through structured and unstructured survey-questionnaires by and large corroborated the reported data with regard to service delivery etc.

“In overall terms, almost all of the sampled consumers gave 100 marks to the complaint redress mechanism of TPL in contrast to 40% satisfaction level prior to 2009,” the report sums up.

THE FLIP SIDE

Despite TERI presenting a rosy picture, the Agra franchisee has been in controversy from time to time. It once drew flak from the Comptroller General of India (CAG).

The CAG, in its report tabled in the UP Vidhan Sabha in August 2012, observed in its concluding remark, “Thus, it is evident that due to irregularities in the bid evaluation process in the supplementary agreement as well as deviation from the energy task force’s recommendations has already caused losses to the extent of Rs 421.12 crore up to March 2012,which will lead to further losses of Rs 4601.12 crore in the remaining 18 years of the franchisee contract besides non-fulfillment of the objective of reduction of AT&C losses.”

Uttar Pradesh Rajya Vidyut Upbhokta Parishad president Avadhesh Kumar Verma said some of the improvements reported by TERI in Agra had taken place all over the state over the years and were not limited to Agra.

Rejecting the TERI report, all-India Power Engineers Federation chairman, Shailendra Dubey said, “We have proposed to the government to form a high-level technical committee to verify and cross-check the TERI’s findings,” he said.

First Published: Mar 27, 2018 15:16 IST