The Hindu : No hike in power tariff in 2003: Transco

Online edition of India's National Newspaper
Thursday, Feb 20, 2003

Southern States

Southern States - Andhra Pradesh

No hike in power tariff in 2003: Transco

By Our Special Correspondent

Hyderabad Feb. 19. At the public hearing by the Andhra Pradesh Electricity Regulatory Commission (APERC) on tariff proposals for 2003-04, which began at the Ravindra Bharati here today, the AP Transco stuck to its earlier stand not to hike tariff for any category of consumers for the year due to various factors.

In her maiden appearance before the Commission, the Transco CMD, Rachel Chatterjee, made a spirited power-point presentation highlighting the utility's reasons for keeping the rates unchanged, while the objectors among whom M. V. Mysoora Reddy of the Congress was a star attraction, contended that the no-hike stand was a "gimmick'' resorted to by the Government in the light of the coming Assembly elections and feared that the hike might be a certainty in the course of the year.

After the hearing for three more days here and for one day at Tirupati on February 26, the Commission is expected to issue an order by March 23 accepting or altering the proposals suiting the undertaking's revenue requirement. Then, the rates with change or otherwise will be notified and implemented with effect from April 1. Its chairman, G. P. Rao, gave an on-the-spot indication to reduce the traction power rate meant for railways following a strong plea made by the electrical chiefs of the South Central Railway, Southern Railway and Eastern Railway, that the present rate at Rs 4.60 per unit was on the high side and it "should'' be slashed to Rs. 3 from Rs 4.05 which was temporarily fixed by the High Court.

Ms. Chatterjee took the no-hike stand mainly on the presumption that 2003-04, coming after three successive drought years, was going to be a good monsoon year which would give the twin benefit of reducing the consumption by agricultural pumpsets to 10,998 million units from 11,237 mu of the currenet year and making more hydel power available. The other "factors'' cited by her for the static tariff rates were the expected Government subsidy which would mop up the Rs 1,501-crore revenue gap, hike in revenue by Rs 748 crores due to increased metered sales, better collections and theft control which were all clubbed under "efficiency improvement'', increase in industrial sales by 11 per cent, reduction in T&D losses to 24.8 per cent from 27.6 per cent now, and lastly, fall in purchase cost to Rs 1.79 per unit, compared to Rs 1.86 as of now.

The CMD pleaded that the ongoing reforms were not a waste and that they, in fact, were giving good results, citing improved quality supply with sufficient voltages, a direct benefit out of massive T&D infrastructure improvement programme, reliable flow to agriculture, increased supply to rural areas with the separation of agriculture feeders, separate feeders for HT users, and better customer services such as e-Seva centres. However, Mr. Mysoora Reddy took the CMD to task saying "fixed cost'' which was allowed at higher level for private projects was the chief culprit and the no-hike proposal would be possible only if this was controlled by a review of power purchase agreements signed with the IPPs, especially Spectrum, GVK and Lanco.

The Congress leader saw no reason in investing Rs 1,100 crores for reducing one per cent of T&D loss, while the benefit out of this was only Rs 78 crores for one per cent reduction.

An interesting aspect was that for the first time, the electricity staff was prevented from participating in the public hearing, but K. Raghu, associate president, APSEB Engineers' Association, who was served a show-cause notice for earlier participation, filed a petition before the commission. Serving of the notice was objected to by B. V. Raghvulu, secretary, State CPI (M) and Dr. Mysoora Reddy who said the staff knew technical matters and it was not wrong if the public benefited out of their knoweldge.

The petitioners who included M. Venugopala Rao, a journalist, M. Thimma Reddy of the People's Monitoring Group, J. Srinivasa Rao of the Congress working group on power, A. Punna Rao, a boiler expert, by and large, welcomed the move by the Transco not to hike tariff.

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