Several policies of Centre led to increase in power cost: TSSPDCL

Hyderabad: The Telangana State Southern Power Distribution Company Limited (TSSPDCL) on Friday said several policies of the Centre led to the increase in power cost. In a power presentation made during a public hearing conducted by the Telangana State Electricity Regulatory Commission (TSERC) on tariff proposals submitted by TS discoms (power utilities), TSSPDCL Chairman and […]

Hyderabad: The Telangana State Southern Power Distribution Company Limited (TSSPDCL) on Friday said several policies of the Centre led to the increase in power cost.

In a power presentation made during a public hearing conducted by the Telangana State Electricity Regulatory Commission (TSERC) on tariff proposals submitted by TS discoms (power utilities), TSSPDCL Chairman and Managing Director G Raghuma Reddy said that it has been five years now since the last tariff hike.

---

But in the said duration, all the costs incurred by discoms in terms of power purchase cost, transmission and network cost have increased significantly leading to a constantly increasing revenue gap.

The last tariff hike was approved by the Commission in financial year (FY) 2016-17 (previous hike in 2015-16 and 2016-17 – 5.5 per cent and 7.58 per cent respectively).

Explaining the Centre’s policies, he said an increase in clean energy cess from Rs.50 per tonne in FY 2014-15 to Rs.400 per tonne as on date along with increase in coal cost by about Rs.800 per tonne from FY 2014- 15 to FY 2020-21 (Rs.1,450 per tonne to Rs. 2,226 per tonne) and rise in coal royalty from 14 per cent in FY 2014-15 to 18.48 per cent as on date resulted in the rise of cost.

An increase in railway freight by 40 per cent in the last four years and petrol and diesel prices also contributed for rise in the cost. According to Reddy, there has been an increase in finance cost due to strengthening transmission and distribution network by adding 1011 new 33/11 KV substations, 2311 power transformers (PTRs) and 3,34,524 distribution transformers (DTRS) by investing Rs.34,087 crore to supply reliable power to all categories of consumers including free supply to agriculture in the State.

New agriculture services released after formation of Telangana are 7.1 lakhs. Telangana met a peak demand of 13,688 MW on March 26, 2021 exceeding united Andhra Pradesh peak demand of 13,162 MW on March 23, 2014.

The per capita consumption, which is one of the indicators of the development of the State for the year 2020-21, was 2071 units as against all India average of 1161 units.

Another reason for proposing tariff hike was that TS Discoms have carried out tariff comparison analysis of all the major consumer categories across various States. It was found that the tariffs for lower domestic (LT) slabs, high tension (HT) and commercial and industrial categories for TS are significantly lower compared to Gujarat, Uttar Pradesh, Haryana, Rajasthan, Punjab and West Bengal among other States.

Thus, the proposed hike was justifiable, Reddy said. For LT domestic category, the proposed tariffs were still significantly lower than the cost of service for FY 2022-23. Hence, the discoms believe that the proposed tariff hike was inevitable and justified to improve its financial condition and better customer service and accordingly request the TSERC to approve the same after due regulatory proceedings.

Discoms proposed that the remaining revenue gap of Rs.2686.79 crore for TSSPDCL and Rs.1410.44 crore for TSNPDCL will be met by improving its current operational efficiencies. Increase in cross-subsidizing sales and power purchase cost at optimized rates, will lead to further reduction in the gap.

Discoms should also improve its revenue by converting remaining 20 per cent non-IRDA services to IRDA, leading to increase in billing efficiency. They are preparing a scheme for installation of smart meters in a phased manner.

---

Now you can get handpicked stories from Telangana Today on Telegram everyday. Click the link to subscribe.

Click to follow Telangana Today Facebook page and Twitter .

---