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Hefty power tariff hike in UP
Uttar Pradesh

Hefty power tariff hike in UP

Agency News

Lucknow,Sep 3: Uttar Pradesh State Electricity Commission (UPSEC) on Tuesday announced a hefty hike in power tariff of 12 to 15 per cent for different categories of consumers, an official statement said.

The UPPCL in its annual revenue requirement had shown a revenue gap of Rs 8,837 crore. The regulator however approved gap of only Rs 3,593, thus leading to the hike in power tariff.

Moreover UP government defaulted in payment of subsidy of Rs 15,089 crore to the power utility in 2017-18, thus adding to the revenue gap.

The average hike in tariff for the urban domestic consumers is 12 per cent while the hike for the industries is 5 to 10 per cent.

The regulator has created a new category of urban BPL consumers.
The rural consumer with connected load of one KW would be charged Rs three per unit for consumption up to 100 units per month while for the urban BPL consumer the unit has been reduced to Rs 50 per month.
The power utility UP Power Corporation Limited (UPPCl) in annual revenue requirement filed with the UPSERC had sought an average hike of 25 per cent in tariff to cover its huge cash losses.

he tariff for the rural un metered consumer has been hiked by 25 per cent or Rs 500 from Rs 400 per month on load of one KW. For the unmetered private tube well the tariff has been hiked by 14 per cent, from Rs 150 per HP to Rs 170 per HP.
The power regulator has defended the tariff hike citing several reasons.
It said the number of bulk consumers and their power consumption like railway, lift irrigation has decreased as they are purchasing directly from power generator under the provision of `open access regime’ as per the Indian electricity Act 2003.
The sale of power to Railway by UPPCL has decreased by 83.4 per cent during the last two fiscal 2017-18 and 2018-19.

''The migration to open access regime is expected to increase further in future, in view of this it is necessary to increase the power tariff'' said the tariff order.

The sale of energy by the UPPCL to urban consumers has also gone down due to roof top solar power plants.

The fixed cost paid by the UPPCL as per the PPA signed with the power generators has also increased.

The low plant load factor of 85 per cent of the PSU power plants has also led to hike in cost for the UPPCL.

According to the regulator, the CIL has increased the price of coal resulting in increase in cost of energy by 10-14 paisa per unit. Besides railway freight and transportation cost has also increased over the years. The power transmission charge has also increased.

The power regulator reneged from the promise made in the last tariff order of November 2017.

The power regulator had said it has linked the power tariff with the aggregate technical and commercial losses and that the UPPCL will do 100 per cent revenue recovery for the coming years that is 2017-18 and 2018-19, thus raising the bar of efficiency and standards of accountability on UPPCl. Had the regulator followed its own order , would have deprived the UPPCl from seeking further hike in power tariff on the ground of high line losses and high outstanding revenue.

The line losses in 2017 and current were over 30 per cent. The tariff in 2017-18 was computed on the basis of 19 per cent line loss. The power regulator has approved multi year aggregate revenue requirement. The power utility was bound to reduce the line losses to 15 per cent by 2018-19 and 12.96 per cent in 2019-20 and ensure hundred per cent revenue realisations. Then regulator did nothing to ensure the compliance of its own order of November 2017.

The UP Power employee’s joint action committee has condemned the hike in power tariff. ''Power consumers are being made to pay from their nose for the inefficiency of the state government as the government departments owe over Rs 11,000 crore to UPPCL and government defaulted in payment of subsidy of Rs 15,000 crore to the power utility'', Convener Shailendra Dubey said.

He further said UPPCL had to pay as much as Rs 4,800 crore to private power generators as fixed charges as per the PPA signed with them.

He added that fixed charges are to be paid even if one unit is not drawn by the UPPCL from the power generators with whom it has signed the PPA. (UNI)