Date:11/05/2007 URL: http://www.thehindu.com/2007/05/11/stories/2007051119080400.htm

Karnataka - Bangalore

KERC notice to Escoms on revenue gap

Special Correspondent

Power utilities given 15 days to respond to the notice and explain their position

All the five power utilities projected revenue gap

Government has promised to pay Rs. 1,800 crore

BANGALORE: Karnataka Electricity Regulatory Commission (KERC) has issued notices to all five electricity supplying companies (Escoms) in the State asking them to inform within 15 days how they proposed to fill their revenue gap.

According to sources in Karnataka Power Transmission Corporation Ltd. (KPTCL), the five Escoms are facing revenue deficit. While the Government had announced that it would provide a subsidy of Rs 1,800 crore to the power sector, the Escoms had not indicated how they would fill the remaining gap.

The Escoms have filed Expected Revenue from Charges (ERC), which indicates the projected revenues as well as expenditure for 2007-08 before the power regulator. Their ERC had projected a huge revenue gap. But they reportedly not mentioned how they would fill the revenue gap.

Besides, they were yet to file tariff petitions seeking any increase in tariff to fill the revenue gap.

Hence, the power regulator was learnt to have cautioned the Escoms that it would not entertain any requests for tariff increase if they failed to inform within 15 days on their plans to fill the gap. Speculation is rife that though the Escoms are eager to seek increase in power tariff, the Government was yet to give them green signal to file a tariff petition before the KERC in view of the elections to the urban local bodies.

The notice issued by the KERC had put the Escoms as well as the Government in a fix, sources said.

Interestingly, the recent tariff order issued by the KERC is yet to be implemented as the order had been challenged before the Central Electricity Appellate by the Escoms.