BEFORE THE UTTAR PRADESH ELECTRICITY REGULATORY COMMISSION, LUCKNOW

Transcription

1 BEFORE THE UTTAR PRADESH ELECTRICITY REGULATORY COMMISSION, LUCKNOW Petition Nos. 860, 864, 865, 866, 867, 868 / 2012 IN THE MATTER OF: Application for determination of Annual Revenue Requirement and Tariff for the FY under Section 64 of the Electricity Act, And IN THE MATTER OF: Kanpur Electricity Supply Company Ltd., Kanpur (KESCO) Uttar Pradesh Power Transmission Corporation Ltd., Lucknow (UPPTCL) Madhyanchal Vidyut Vitran Nigam Ltd., Lucknow (MVVNL) Dakshinanchal Vidyut Vitran Nigam Ltd., Agra (DVVNL) Poorvanchal Vidyut Vitran Nigam Ltd., Varanasi (PuVVNL) Pashchimanchal Vidyut Vitran Nigam Ltd., Meerut (PVVNL) The following were present: 1. Mr. Alok Kumar Verma, Director (Commercial), PVVNL 2. Mr. Sudhanshu Dwivedi, Director (Finance), PuVVNL 3. Mr. Sanjay Kumar Singh, Director (Commercial), MVVNL 4. Mr. Ram Sajeevan, Chief General Manager (Finance), MVVNL 5. Mr. A.K. Gupta General Manager (Finance), UPPCL 6. Mr. Ravindra Kumar, Chief Engineer (KESCO) 7. Mr. M. Ghufran, Chief Engineer (RAU), UPPCL 8. Mr. S.M. Mittal, Chief Engineer (Commercial), DVVNL 9. Mr. S. Joshi, Executive Engineer (RAU), UPPCL 10. Mr. D. C. Verma, Executive Engineer (RAU), UPPCL 11. Mr. S. A. Rizvi, Executive Engineer (RAU), UPPCL 12. Mr. B. K. Saxena, Executive Engineer (Commercial), UPPTCL 13. Mr. V. P. Singh, Executive Engineer, PuVVNL 14. Mr. Brijesh Kumar, Executive Engineer, DVVNL 15. Mr. B. S. Goel, Prudential Project Syndicate, Consultant 16. Mr. Bhushan Rastogi, Consultant 1

2 17. Mr. Mohit Goyal, Consultant 18. Mr. Avinav Ahuja, Consultant ORDER (Date of Hearing ) As per provisions of Section 64 of the Electricity Act, 2003, it is incumbent upon the licensee to make an application to the State Regulatory Commission for determination of tariff in such manner as may be determined by Regulations framed by the Commission. The UPERC framed the UPERC (Terms and Conditions of Distribution Tariff) Regulations, 2006 (hence forth referred as Distribution Tariff Regulations) and UPERC (Terms and Conditions of Transmission Tariff) Regulations, 2006 (hence forth referred as Transmission Tariff Regulations) on 6 th October, As per the provisions stipulated in Regulation 2.1.1, the licensees are required to file before this Commission a petition for determination of its Aggregate Revenue Requirement (ARR) / Tariff for FY complete in all respect on or before 30 th November, The distribution licensee namely KESCO, has filed its ARR Petition for FY on 3 rd December, The other state owned Distribution Licensees namely DVVNL, MVVNL, PVVNL, PuVVNL along with transmission licensee namely UPPTCL have filed the ARR Petitions for FY on 7 th December, The licensees have submitted the provisional accounts for FY along with the calculations of revenue gap for FY and the projected revenue for FY based on current tariff in their ARR Petitions. However the ARR Petitions did not contain a tariff proposal to bridge the gap through tariff hike. A preliminary analysis of the petitions was conducted by the Commission wherein it was observed that the audited accounts for the period (i.e. FY ) as stipulated by the Regulations were not submitted by the licensees. The matter of submission of audited accounts was also reaffirmed in Hon ble APTEL judgment dated 21 st October, 2011 in Appeal No. 121 of 2010 in the licensees case. The ARR Petitions did not propose any mechanism to bridge the revenue gap which was in contravention to the stipulation of Regulation of the Distribution Tariff Regulations. In this regard, a deficiency note was issued by the Commission on 27 th December, 2012 directing the licensees to submit their proposal for bridging the revenue gap. Such deficiency note also sought clarification on other issues in regard to the ARR Petitions filed. The Commission had granted a time of two weeks to respond on the deficiency note i.e., by 10 th January,

3 Thereafter, KESCO in a letter dated 17 th January, 2013 had requested the Commission to grant extension of time limit by two weeks. Similarly, the other distribution licensees namely DVVNL, MVVNL, PVVNL, PuVVNL and transmission licensee namely UPPTCL had requested for a time extension by two weeks vide a letter dated 18 th January, KESCO submitted the replies to the Deficiency Note on 24 th January, The Distribution Licensees namely DVVNL, PVVNL and PuVVNL submitted the replies to the Deficiency Note on 6 th February, MVVNL submitted the replies to the Deficiency Note on 7 th February and 13 th February, UPPTCL submitted the replies to the Deficiency Note on 7 th February, However the detailed proposal for bridging the revenue gap was not submitted by the distribution licensees. Vide the judgement dated 11 th November, 2011 in the matter OP No. 1 of 2011, Hon ble APTEL has directed the State Commissions that In the event of delay in filing of the ARR, truing-up and Annual Performance Review, one month beyond the scheduled date of submission of the petition, the State Commission must initiate suo-moto proceedings for tariff determination in accordance with Section 64 of the Act read with clause 8.1 (7) of the Tariff Policy. Further the Commission issued a notice dated 16 th January, 2013 intimating the licensees to remain present on 28 th January, 2013 and explain the reasons to the Commission for nonsubmission of audited accounts of relevant years as required by the Regulations, lack of proposal for bridging the revenue gap and as to why suo-moto proceedings for determination of ARR and Tariff not be initiated. During the hearing held on 28 th January, 2013, the following oral submissions were made by the licensees: Mr Sanjay Kumar Singh, Director (Commercial), MVVNL submitted that the statutory audited accounts by chartered accountant firms appointed by the Comptroller and Auditor General of India (CAG) for FY would be submitted by February 28, He further submitted that the report of the Accountant General of Uttar Pradesh would take further time as the office of the Accountant General being a constitutional body is not under any control of the licensees and hence the licensees are not in a position to expedite the process of their audit. This contention was agreed by other licensees and they agreed to submit the statutory audited accounts (without CAG Report) up to FY by 28 th February, Further he informed that the proposed tariff proposal for FY has been held up for approval at the final authority. However no time line was provided regarding its submission to the Commission. He requested that the Commission may proceed with suo-moto tariff determination. In the matter of preparation of fixed asset registers, it was observed that no progress has been made. The fixed asset registers of KESCO have been prepared and 3

4 submitted for the year up to FY vide its letter dated 24 th January, In the case of other licensees, it was submitted, that currently they are not in a position to submit the same. The Commission directed all the licensees to submit the status on the above on an affidavit as well. In this regard, the submission on Affidavit was received from KESCO on 4 th February, The details are quoted below: 1. That the audited accounts for FY and have already been submitted before the Hon ble Commission vide letter no. 44/Kesco/Accts/A.O.(A)/ERC dated 15 th January 2013 and received by the Hon ble Commission on 17 th January Further, it is the endeavour of the Petitioner to submit the statutory audited accounts for FY by 15 th February The Petitioner would like to humbly submit that the Hon ble Commission approves tariff which is uniform throughout the state. As a consequence the Petitioner cannot apply for tariff rationalization in its supply area by separately filing for revision of tariff. The Hon ble Commission suitably decides on the tariff structure proposed by state owned distribution companies namely Paschimanchal Vidyut Vitran Nigam Ltd Dakshinanchal Vidyut Vitran Nigam Ltd Madhyanchal Vidyut Vitran Nigam Ltd Purvanchal Vidyut Vitran Nigam Ltd The aforementioned companies are in the process of filing their ARR / Tariff Petitions for the FY before the Hon ble Commission. The Rate and Charges which the Hon ble Commission would approve for such distribution companies and which would be applicable uniformly across the state would be applicable for the Petitioner as well. Once the aforementioned distribution companies file the ARR and Tariff Proposals and the Rate Schedule, the Petitioner would ratify the applicability of the same rate schedule through an additional submission and would submit the estimates in respect of revenue at proposed tariffs. The statutory audited accounts (without CAG Report) for FY and the Fixed Asset Registers for FY have been submitted by KESCO on 16 th February, The Affidavits in respect of DVVNL, MVVNL and PuVVNL were received on 5 th February, Subsequently the Affidavit in respect of PVVNL was received on 13 th February, The aforementioned distribution companies namely DVVNL, MVVNL, PVVNL and PuVVNL have submitted identical submissions in the affidavit as quoted below: 4

5 1. That the audit for the FY is under process and efforts are being made to make available the audited balance sheet (without CAG report) by That the tariff proposal shall be filed soon before the Hon ble Commission. The position has already been narrated in detail by licensee s representative during hearing. 3. That the Fixed Asset Register is under preparation and shall be submitted after the work is completed. UPPTCL has filed its affidavit dated 21 st February, 2013, the details of which are quoted as below: 1. That the Annual Accounts along with the Statutory Auditor s Report for the FY shall be submitted by 15 th March, That the Fixed Asset Register is under the process of preparation. Subsequently, on 4 th March, 2013 the Chairman of MVVNL, PVVNL, DVVNL & PuVVNL filed the Rate Schedule for FY vide letter No. 497/RAU/ARR FY , further in continuation to the Annual Revenue Requirement (ARR) Petitions of State Distribution Licensees for FY filed on 7 th December, KESCO also filed the Rate Schedule for FY on 8 th March, 2013 as an additional submission to its ARR Petition for FY filed on 3 rd December, However the audited accounts for FY (with CAG report) has not been submitted by the distribution companies. In pursuance with the directions of the Hon ble APTEL, powers conferred under Section 64 of the Electricity Act, 2003 and the Regulation of the Distribution Tariff Regulations and the Regulation of the Transmission Tariff Regulations, considering the deficiencies in the ARR Petitions, the Commission has decided to initiate suo-motu proceedings for determining the ARR and Tariff of the licensees for FY The Commission hereby directs each licensee to publish Public Notice within 3 days detailing the salient information and facts of the ARR Petitions for FY and the Rate Schedule (Tariff Proposed for different categories / sub-categories of consumers) along with their website address in at least two daily newspapers (One English and One Hindi) for two successive days inviting views / comments / suggestions / objections / representations within 15 days from the date of publication of the Public Notice(s) by all stakeholders and public at large. The Public Notice should also contain the details of the T&D losses, average power purchase cost, average cost of supply, average retail tariff realised from each category / sub-category of consumers and the % of average tariff rise required to cover the proposed revenue gap. The Public Notices should inform the stakeholders and public at large to regularly check the websites of the licensee for further submissions made in reselect to these proceedings. The Commission further directs each licensee to upload the submitted petitions along with the response to the deficiency note and all subsequent submissions made in respect to these proceedings on their website for the same purpose. 5

6 The Commission reserves the right to seek any further information / clarifications as deemed necessary during the suo-moto proceedings for determination of ARR and Tariff for FY sd- (Meenakshi Singh) Member -sd- (Shree Ram) Member Place: Lucknow Date: 11 th March,