BHUBANESWAR: Expressing concern over industries in State sourcing power on open access to reduce the cost of their input or setting up captive power plants to meet their needs, Tata Power Central Odisha Distribution Limited (TPCODL) has proposed the Odisha Electricity Regulatory Commission to remove concession granted to industries by the State government.
Proposing tariff rationalisation, TPCODL in its aggregate revenue requirement (ARR) application to OERC for the ensuing financial year contended that in a cost plus approach model for a distribution licensee where tariffs are reduced for a category of consumers at the cost of other categories, it is necessary to balance the interest of all the consumers.
Pointing out that several industries are not consuming energy from the distribution companies (discoms) of the State to the fullest extent, it said that they are either sourcing power on open access to reduce the cost of their input or setting up captive power plants (CPP) to meet their needs.
“One of the reasons for such behaviour is that the tariffs are not economical enough for industries. A reduction in tariff sought by the industries should be addressed so that they purchase power from the distribution companies operating in the State,” TPCODL said. Though the Commission has been addressing this issue by offering special tariffs in the form of incentives to a class or category of consumers, the recent one to steel plants in the 2021-22 tariff order, the petitioner proposed that the cross-subsidy surcharge (CSS) on power sourced through open access from renewable sources, which is currently exempted, should be levied at 100 per cent.
“There should not be any concessional cross-subsidy surcharge. The concessional wheeling and transmission charges (20 per cent) may also be removed,” the petitioner said. This will enable the discom to collect its legitimate charges of CSS and the wheeling charges and pass on the benefit of the same to other consumers thereby creating a win-win situation.
Projecting a revenue gap of Rs 257 crore for 2022-23 at the existing retail supply tariff rate, TPCODL urged the Commission to fix the tariff accordingly to enable the company to recover the cost. The distribution utility has proposed to sell 7,360 million units (MU) of power and estimating a distribution loss of 22.93 per cent, the total power to be purchased by it comes to 9,550 MU. Working out the ARR at Rs 4,411 crore with normative distribution loss, the petitioner said it will realise Rs 4,154.46 crore at the existing retail supply tariff resulting in a revenue gap of Rs 256.9 crore.