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Electricity regulatory body reduces power tariff for 2019-20

GUWAHATI, March 4 – The Assam Electricity Regulatory Commission (AERC) has reduced the existing power tariff of the public sector Assam Power Distribution Company Ltd (APDCL) by four per cent on an average for the financial year 2019-20 against the plea made by the power utility before it for enhancement of the tariff by 9.9 per cent on an average over the existing ones. The AERC order on the tariff was issued on March 1, 2019. It is yet to be notified by the power utility.

The APDCL said in its tariff petition that there would be a 33 per cent gap between its earning and expenditure in 2019-20 and hence it pleaded for 9.9 per cent hike in its power tariff on an average. But the AERC, after hearing all the parties concerned, reduced the tariff by four per cent from the existing ones on an average. The new tariff will come into effect from April 1, 2019.
However, this relief would not be reflected greatly in the energy bills of almost all the consumers, as the energy charge is reduced at the rate of 5 paise per unit, keeping the fixed charge intact. The four per cent reduction is so calculated that it will reflect only in the gross revenue collection of the power utility, APDCL sources said.

The APDCL said in its tariff petition that there would be a cumulative gap in its revenue to the tune of Rs 2,016.21 crore for 2019-20. It also said in its petition that its aggregate revenue requirement for 2019-20 would be Rs 6,419.18 crore, while that would be Rs 7,180.14 crore for 2020-21 and Rs 7,909.61 crore for 2021-22. It also said that it has a capital investment plan for MYT (multi-year tariff) control period. Its projected capital investment plan is worth Rs 2,782.04 crore for 2019-20, Rs 1,165.86 crore for 2020-21 and Rs 1,091.83 crore for 2021-22.

The power utility submitted that they have not prayed for recovery of the total revenue deficit of Rs 2,016.21 crore in 2019-20. It has proposed recovery of 50 per cent of revenue gap after an adjustment to estimated amount for 2017-18 and 50 per cent of the revenue gap for 2019-20, amounting to Rs 598.65 crore through retail tariff. It further said that it would request the State government for funding the remaining amount of Rs 1,417.56 crore.

And for the proposed 50 per cent recovery of its deficit, the power utility proposed average tariff increase to the extent of 9.9 per cent.

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