VIJAYAWADA: Noting that power distribution companies (Discoms) being in financial distress “does not augur well for the State and consumers,” the AP Electricity Regulatory Commission (APERC) has permitted them to recover true-up charges for distribution business for the period between 2014-15 and 2018-19. The APERC has allowed the Discoms to recover Rs 3,669 crore in equal instalments starting August, 2021, from APSPDCL and APEPDCL consumers concerned with an interest of 10.3%. This means, true-up recovery will begin from August bills generated in September.
According to an order dated August 27, but uploaded on Monday, the APERC noted that the APSPDCL and APEPDCL have cumulative losses of Rs 12,539 crore and Rs 7,749 crore by the end of 2018-19.While the APSPDCL claimed a total of Rs 5,889 crore, including carrying costs as the true-up for the third control period of 2014-15 to 2018-19, the APEPDCL claimed Rs 1,335.51 crore total.After holding public hearings and considering objections of stakeholders, the APERC determined the charges to be Rs 3,060 crore for the APSPDCL and Rs 609 for the APEPDCL.
“Accordingly, the Discoms are permitted to recover the total true-up amount in the remaining eight months period of 2021-22 in equal instalments at the interest rate of 10.3% on the true-up amount for the recovery period only,” the order read.
The recovery from the APCPDCL consumers will also be done as they were under the APSPDCL till April 1, 2020. Since the AP government is committed to providing free power to eligible farmers, the Discoms may recover the charges from the government, the APERC suggested. “If the State government is not willing to pay the amount, it shall be recovered from farmers,” the APERC added. Same will apply to other categories availing free power. If the State does not want to bear the burden, the recovery shall be from the consumers concerned, the APERC said.
“The consumers who were extended supply from April 1, 2019, will be exempted from payment of the true-up amount,” the commission clarified.It may be recalled that the APERC, in November, 2020, had approved Rs 3,103 crore as true-up charges for retail supply business for the years 2014-15, 2016-17, 2017-18 and 2018-19. For the uninitiated, distribution business is authorised business of the licensee in power distribution in the area of supply, while retail supply business means authorised business of the licensee in retail supply of electricity in the area of supply.
The APERC directed the discoms to clearly segregate the retail supply business and the distribution business in their annual accounts as per the norms. Also, the Discoms were directed to furnish the details of actual recovery done by the end of March, 2022 for making adjustments, if need be.“In respect of the true-up amount collection from consumers on per unit basis as per this order, the retail supply business tariff order issued on March 25, 2021 is deemed to have been amended.”