Power regulator DERC to announce revised tariff despite AAP govt’s objections

New Delhi(PTI): Delhi’s power regulator DERC is all set to announce revised tariff for 2015-16 next month notwithstanding AAP government’s directive not to go ahead with the new rates till the CAG has submitted its report on the financial condition of three private power distribution companies.

The Kejriwal government had in February announced a 50% subsidy on monthly power consumption of up to 400 units till the government receives the CAG report on financial condition of the discoms. File Photo dna Research & Archives
The Kejriwal government had in February announced a 50% subsidy on monthly power consumption of up to 400 units till the government receives the CAG report on financial condition of the discoms. File Photo dna

Sources in Delhi Electricity Regulatory Commission (DERC) said the tariff determination process was going on and it will announce the new rates, which may see a marginal hike, even if the government had strong reservations about it.

On June 12, the DERC had hiked tariff by upto six per cent as it restored a surcharge to compensate the private distribution companies for rise in power purchase cost. The AAP government strongly criticised the DERC for the hike and said it was exploring legal option against the decision.

“We are going ahead with the tariff determination process. It is an annual exercise. We are analysing the financial details of the discoms and take decision accordingly,” said a top official in the DERC.

The Delhi government had asked the DERC not to hike tariff till the CAG submits its report on finances of the discoms.

Power tariff was a major issue for AAP during the Delhi polls. The Kejriwal government had in February announced a 50% subsidy on monthly power consumption of up to 400 units till the government receives the CAG report on financial condition of the discoms.

In its first stint, the AAP government had ordered a CAG audit of all the three discoms, claiming that they have been misleading the government and the DERC about their financial position.

The city has seen a series of hikes in power tariff in the past two years. The tariff was hiked by 22% in 2011 followed by 5% rise in February 2012.

The tariff was increased by up to 2% in May 2012 and again by 26% for domestic consumers in July 2012.

It was hiked by up to 3% in February 2013 and again by 5% in August 2013. It was increased by upto 7% in November last year.

The cost of buying power has increased primarily on account of an increase in the input prices of raw material like coal and gas, officials said.

The DERC effected the hike of upto 6% on June 12 following an order by Appellate Tribunal of Electricity which had asked the DERC to pass on Power Purchase Adjustment Cost (PPAC) to the private power distribution companies within three weeks.

The DERC said the PPAC surcharge has been approved considering claims of the discoms for last three quarters beginning July, 2014.

The DERC had introduced PPAC in 2012 to help the private power distribution companies recover additional cost on account of increase in coal and gas prices.

Delhi gets power from a number of gas and coal-based generation plants. The DERC had withdrawn the PPAC in July.