BHUBANESWAR: The Odisha Electricity Regulatory Commission (OERC) on Tuesday questioned the steep rise in operation and maintenance (O&M) expenditure projected by the Tata Power Northern Odisha Distribution Limited (TPNODL), saying the increase was not matched by proportional improvement in service delivery.
Chairing a public hearing on the utility’s annual revenue requirement and tariff petition for 2026-27 at Balasore, OERC chairman Pradeep Kumar Jena expressed serious concerns over the company’s projected O&M expenditure of `1,486 crore.
He observed that maintenance costs have increased manifold since Tata Power took over distribution operations in northern Odisha nearly five years ago, without a commensurate improvement in service quality.
“The expenditure has risen substantially over the past five years but service standards have not improved proportionately. The company must rationalise its O&M cost,” Jena observed.
The commission also questioned the utility’s manpower structure, pointing to the large workforce engaged in distribution operations.
Jena asked what roles were being performed by the approximately 52,000 indirectly engaged personnel and 13,500 regular employees, and sought a detailed justification of the expenditure. He sought a detailed affidavit explaining the cost escalation.
TPNODL, in its petition, projected total revenue requirement of `5,152 crore for 2026-27. It plans to procure 8,854 million units of power from GRIDCO and sell 7,802 million units to consumers. The utility expects to generate `4,694 crore from tariff revenue and `196 crore from non-tariff sources, leaving a revenue gap of `263 crore.
The company also projected a reduction in distribution losses from the currently approved 12.96 per cent to 11.88 per cent in the next financial year.
GRIDCO director (commercial) Debasish Das suggested that maintenance costs should be assessed based on electricity sales volume rather than fixed asset value, in line with practices adopted by some other regulatory commissions in India.
Former electrical inspector Akshaya Sahani questioned the projected distribution loss figure, alleging possible discrepancies, while consumer representative Basudev Bhatt urged the commission to safeguard consumer interests. Power analyst Anand Mahapatra recommended extending the meter rent waiver up to 3 kW load, in line with rooftop solar subsidy provisions, instead of the current 2 kW limit.
The state government informed the commission that it will submit its views on the tariff proposal by February 24.