Objections to DERC reg. Tariff hike

The Secretary
DERC, Viniyamak Bhawan,
C-Block, Shivalik, Malviya Nagar,
New Delhi-110017


Subject: Public Response to ARR-Tariff for FY 2010-11


Ref: Public Notice in HT dated 17.1.2010

Dear Sir,

Following observations which are common to all Licensees be considered before taking up ARR’s for Financial year 2010-11


1. Physical Verification

i) ARR of Discoms should not be considered till the process of physical verification of capital expenditure is scrutinized.

ii) M/s ASCI Hydrabad ,assigned the work for physical verification be directed to involve local RWA’s, NGO’s and individuals to assess ground realties.

2. Format

Format for presentation of ARR data is not same, therefore comparison and making observation for an ordinary consumer is difficult. Hence more details in term of fixed charges and category wise recovery in a standard format be made available for reasonable feedback.

3. Tarrif Revision

Discoms had proposed tariff increase from 50% to 70% whereas no increase had been proposed by NDMC. Discoms in private sector had already implemented four increases taking it almost to twice the tariff prevailing in July 2002. At the same time there is no increase in NDMC area since 2002. So why the consumers with DISCOM should suffer when tariff, quality of supply and grievance redressal is much better in NDMC.

4. AT & C Loss

AT & C loss calculations are not correct, when major consumption in DISCOM offices as well as sub-stations is not recorded. This stand confirmed in the petition with CIC, RTI by Sh. H L Kalsi. However, metering shall be done now, in all DISCOM offices as well as Sub-Stations and these figures be accounted for since July 2002. It will have repercussion on previous increase in tariff, and suo-moto refund.

5. Fixed Charges

i) Levy of fixed charges differ in DISCOMS & NDMC. The date of implementation is also different [ DISCOM effective in 2004 whereas NDMC- effective in 2008]. The rate of fixed charges is Rs. 2/-per KW in NDMC against Rs. 12/- per kw in DISCOMs. This discrepancy be rectified before approval of ARR for 2010-11.

ii) Fixed charges are not part of regular tariff, therefore it’s account in respect of receipt and expenditure be projected separately and not as part of total revenue.

iii) Services being rendered against fixed charges are not elaborated as on date. How long cosumer is expected to pay fixed charges be projected , as the same are not part of consumption tariff.

6. Subsidy

Cross-subsidy in tariff was basically introduced to support agriculture. Therefore commercial and industrial sector pays higher tariff whereas domestic sector contribute at par. As regards agriculture area in Delhi, it had reduced to 1 5 whereas commercial & industrial revenue increased to more than 40 %. This amounts to undue benefit to licensee, hence bifurcation of revenue in different categories be made public in the ARR.

7. Meter-Replacement

Replacement of electro-mechanical meters to electronic meters is yet to be implemented in domestic sector of NDMC. On the contrary DISCOMs carried out replacement twice i.e from electro-mechanical meters to electronic meters and subsequently electronic meters to digital meters. It appears that technology improvement is not required by VIP area under NDMC, else DISCOM motive is different, be made clear.

8. Transparency

i) There is no transparency in DISCOMs under private sector particularly in tendering and salary structure. Norms and delegations of ECGRF are not available on website. Hence accountability in power sector is low in spite of DERC performance standards tilted in favour of Licensees.

ii) Consumers are bound to bear discretionary pay package to employees. After seven years of operations pay-scale / perks are yet to be standardized especially when Govt. holds sharing of 49 % salaries without norms should not be considered in ARR.

9. Merger of categories
Merger of different categories in tariff and reduction of slabs are not acceptable while looking at ARR’s. NDMC slabs and tariff be implemented in DISCOMs.

10. Time of day metering should not be implemented, till previous issues related to metering and billing are streamlined.

11. Enhancement of load on consumption
and subsequent 30% surcharge on fixed charges as proposed by DISCOM should be rejected. This is nothing except additional harassment to consumers like false cases of theft.



Under the circumstances DERC should not consider ARR’s for 2010-11 till basic issues as mentioned above are not resolved in the interest of lakhs of consumers.


Yours sincerely

Lalit Mohan Sharma
General Secretary
Vishwas Nagar RWA
New Delhi-110092

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