MAHARASHTRA ELECTRICITY REGULATORY COMMISSION

Transcription

1 Before the MAHARASHTRA ELECTRICITY REGULATORY COMMISSION World Trade Centre, Centre No.1, 13th Floor, Cuffe Parade, Mumbai Tel. No /65/69 Fax mercindia@mercindia.org.in Website: / Case No. 22 of 2013 In the matter of Petition of the Brihan-Mumbai Electric Supply and Transport Undertaking (BEST) for review of the Commission s Order dated 28 December, 2012 in Case No. 90 of 2012 in the matter of approval of BEST Undertaking s Schedule of Charges pertaining to charges for Service disconnection on the request of consumer and Service shifting on the request of consumer in the category of Miscellaneous and General Charges Shri. V.P. Raja, Chairman Shri. Vijay L. Sonavane, Member ORDER Dated: 5 June, 2013 The Brihan-Mumbai Electric Supply and Transport Undertaking (BEST) filed a Petition for review of the Commission s Order dated December 28, 2012 in Case No. 90 of 2012 in the matter of approval of BEST Undertaking s Schedule of Charges, pertaining to charges for Service disconnection on the request of consumer and Service shifting on the request of consumer in the category of Miscellaneous and General Charges, under Regulation 85 (a) of the MERC (Conduct of Business) Regulations, In its Petition, BEST prayed as under: i. Admit the review petition in accordance with the Regulation 74 and 85(a) of the MERC (Conduct of Business) Regulations, ii. To review the Order dtd. 28 th December, 2012 issued by Hon ble Commission in Case No. 90 of 2012 in the matter of approval of BEST Undertaking s Schedule of Charges to the extent of Hon ble Commission s ruling on charges for Service MERC Order [Case No. 22 of 2013] Page 1 of 10

2 disconnection on the request of consumer and Service shifting on the request of consumer in the category of Miscellaneous and General Charges. iii. Allow BEST to recover the charges on actual for Service disconnection on the request of consumer and Service shifting on the request of consumer in the category of Miscellaneous and General Charges of BEST s Schedule of Charges." iv. Grant the liberty to the BEST to add/change/modify/alter this petition and make further submissions as may be required at future date. v. Condone any inadvertent omissions/errors/rounding off difference/shortcomings. vi. Pass such further and other orders, as the Hon ble Commission may deem fit and proper keeping in view the facts and circumstances of the case. 2. In its Petition, BEST submitted as under: a. In accordance with Regulation 18 of the MERC (Electricity Supply Code and Other Conditions of Supply) Regulations, 2005, BEST had filed a Petition dated August 30, 2012 for approval of Schedule of Charges, wherein the BEST had submitted that the cost of material and manpower has increased tremendously subsequent to issuance of Order dated 12 October, 2006 in Case No. 26 of 2006 and prayed to the Commission to revise the Schedule of Charges to recover expenditure of various services offered by BEST to its consumers. b. The Commission, vide Order dated 28 December, 2012 in Case No. 90 of 2012 approved the Schedule of Charges for BEST for various categories effective from 1 January, c. Charges for Service disconnection on the request of consumer i. BEST, in Paragraph 10.2 of its Petition dated 30 August, 2012 in Case No. 90 of 2012 had proposed charges for Service disconnection under sub-head of Service call charges in the category of Miscellaneous and General Charges. BEST, in its Petition, had submitted that many requests are received from the consumers to remove the service cable permanently from their premises. BEST had proposed to charge for the activity of removal of service connection on actual basis based on quotation considering obligatory rates given in BEST s Schedule of Estimate and Schedule of Services. ii. The Commission had taken cognizance of BEST s submission for recovery of charges for Service disconnection in Paragraph 3.2 of the MERC Order [Case No. 22 of 2013] Page 2 of 10

3 Order dated 28 December, 2012, however, the Commission ruled as under: Commission s Ruling The Commission observed that the Licensees have considered different subheads for the reconnection services provided by BEST, TPC-D and RInfra- D. The Commission is of the view that though the nomenclature may be different, activities carried out in the field are more or less the same in nature. In order to remove the ambiguities, the Commission has rationalised the activities to be charged. Further, all charges are to be levied only at the time of reconnection, irrespective of whether disconnection has been necessitated on the request of the consumer or on account of non-payment of dues by the consumer. In accordance with the rationale stated in the initial paragraphs of this Section, the approved normative Reconnection Charges (including charges for Disconnection) are indicated in the table below: iii. iv. Particulars Existing Charges Proposed Charges Approved by the (Case No. by BEST Commission 30 of 2006) (Rs.) (Rs.) (Rs.) Reconnection Charges 1 Re-installation of fuse cutout Re-installation of meter HT Supply Re-connection of Service Cable In the approved Schedule of Charges of BEST, the Commission has specified the charges for Reconnection activity only and no charges have been specified for the activity under Service disconnection, as proposed by BEST. The services tendered for restoration of electric supply and Service disconnection (i.e., removal of service cable) on the request of consumer are entirely different. In the case of Service cable disconnection activity, the electric supply to the consumer s installation is disconnected due to demolition of building/slums and service cable is pot-headed at service position for safety. During redevelopment stage, developer of the plot MERC Order [Case No. 22 of 2013] Page 3 of 10

4 requests BEST to disconnect/remove the live service cable. The service disconnection is not a routine activity, but is required to be carried out on the request of the consumer; hence, all service disconnection expenses are to be charged on actual cost basis. For carrying out such activity, besides material, it involves labour for excavation/back filling, dismantling of cutout board/mccb, jointing/termination disconnection work, etc., and transportation of material. The expenses for executing this activity amounts to thousands even for smaller size of cable. BEST also submitted the sample draft quotations. v. Considering the above aspects, it is necessary to separately earmark the charges for the activity of Service disconnection on the request of consumer in the category of Miscellaneous and General Charges of BEST s Schedule of Charges and BEST should be allowed to recover the charges for Service disconnection on the request of consumer on actual cost based on obligatory rates given in BEST s Schedule of Estimate and Schedule of charges applicable for the respective years. d. Charges for Service shifting on the request of consumer i. BEST, in Paragraph 10.3 of its Petition dated 30 August, 2012 in Case No. 90 of 2012 had proposed Charges related to the Meter position shifting in the category of Miscellaneous and General Charges. BEST, in its Petition, had proposed to charge Rs. 300/- (single phase meter), Rs. 400/- (three phase meter), and Rs. 1000/- (CT operated meter) per activity for changing the position of the meter at the request of the consumer (removal/fixing). ii. The Commission had taken cognizance of BEST s proposal for recovery of charges for Shifting of meter in Paragraph of the Order dated 28 December, 2012, however, the Commission ruled as under: Commission s Ruling In this context, in the Order dated 12 October, 2006 in Case No. 26 of 2006, the Commission had ruled as under: i) Changing the position of the meter at consumer s request Considering the average cost of material and labour involved in shifting of meter, the Commission approves the normative charges of Rs. 50/- proposed by BEST with the condition that this would cover the total cost including the cost of material, labour, all other costs MERC Order [Case No. 22 of 2013] Page 4 of 10

5 etc. required for changing the location of the meter and no other charges be added on it. The charges for changing the location of meter within the premise will be applicable only in cases where the shifting is to be done at the request of the consumer. However, when BEST desires to have the location changed, then the cost of such shifting shall be entirely borne by BEST. The Commission observed that the Licensees have considered different subheads for the services provided by RInfra-D, BEST, and TPC-D. The Commission is of the view that though the nomenclature may be different, activities carried out in the field are more or less the same in nature. In order to remove the ambiguities, the Commission has rationalised the activities to be charged. In accordance with the rationale stated in the initial paragraphs of this Section, the approved normative Charges for shifting of services are indicated in the Table below. It is clarified that such charges will be applicable only in cases where shifting is done at the request of the consumer. However, when BEST desires to get the service shifted, then the cost of such shifting shall be entirely borne by BEST. iii. Particulars Existing Charges Proposed Charges Approved by the (Case No. by BEST Commission 26 of 2006) (Rs.) (Rs.) (Rs.) Shifting of services/meter, if 50 - carried out only on consumer s request Single Phase Three Phase In the Order dated 28 December, 2012, the Commission has clubbed the activity of Shifting of services and Shifting of Meter under single head and approved the combined charges for these activities. MERC Order [Case No. 22 of 2013] Page 5 of 10

6 iv. The services tendered for Shifting of Meter and Shifting of services are entirely different. For carrying out activity of Shifting of services, besides material, it involves labour for excavation/backfilling, removal/installation of cutout board/mccb, pulling of service cable, jointing/termination work, etc., and transportation of material. The shifting of service is not a routine activity, but is required to be carried out on the request of the consumer; hence, all service shifting expenses are to be charged on actual cost basis. The expenses for executing this activity amounts to thousands even for smaller size of cable. BEST also submitted the sample draft quotations. v. Considering above aspects, it is necessary to segregate the charges for the activity of Shifting of Services and Shifting of Meter under different head in the category of Miscellaneous and General Charges of BEST s Schedule of Charges and BEST should be allowed to recover the charges for Service shifting on the request of consumer on actual basis, considering obligatory rates given in BEST s Schedule of Estimate and Schedule of Charges applicable for the respective years. e. BEST submitted that the Commission has the power to review and pass reasoned Orders under Regulations 74 and 85(a) of the MERC (Conduct of Business) Regulations, The Commission scheduled a hearing in the matter on 6 March, Shri. P.V. Haldankar represented BEST, and made a brief presentation on the issues raised in the Review Petition. No authorised Consumer Representatives were present for the hearing. The Commission directed BEST to submit the justification for admissibility of the Review Petition, and additional information/data on Shifting of services and service disconnection, within ten days from the date of the hearing. 4. BEST, vide its letter dated 15 March, 2013 made further submissions in the matter. BEST stated that it concurs with the principle of rationalisation adopted by the Commission in its Order dated 28 December, BEST stated that there appears to be an apparent error while arriving at the approved charges for Shifting of service on consumer s request and the Commission has the power to review its Order under Regulation 85(a) of the MERC (Conduct of Business) Regulations, BEST also submitted the details of activities carried out by BEST under Shifting of service on consumer s request during the last 3- year period and stated that expenses for carrying out shifting of service on the consumer request are on higher side vis-à-vis the charges of Rs. 100/- and Rs. 300/- approved by the MERC Order [Case No. 22 of 2013] Page 6 of 10

7 Commission for single phase and three phase respectively in the Order dated 28 December, With reference to Order dated 2 November, 2006, BEST submitted that Shifting of service is a non-regular activity, which is carried out on specific need of the consumer, and hence, the expenses incurred by the BEST for this activity should be allowed to be recovered on actual basis from the respective consumer rather than passing on to the other consumers in retail tariff. BEST also stated that the specific requirements of Shifting of service and Service disconnection are increasing due to rise in activities of redevelopment of slum/old buildings as well as extension of existing building structures. 5. The Commission, vide Notice dated 2 April, 2013, scheduled a second hearing in the matter on 16 April, During the hearing held on 16 April, 2013, Shri, R.D.Patsute represented BEST, and made a brief presentation on the issues raised in the Review Petition. No authorised Consumer Representatives were present for the hearing. In addition to the points made in the Review Petition, BEST submitted as under: a. As regards admissibility the Review Petition, BEST quoted Regulation 85 (a) of the MERC (Conduct of Business) Regulations, 2004, and submitted that the Regulations provide for review on account of error apparent on the face of the record or for any other sufficient reasons. BEST further requested the Commission to admit the Review Petition on the following grounds: (i) The activities of Meter shifting and Service shifting are different, and are not interchangeable as treated in the Order dated 28 December, 2012 in Case No. 90 of This has been noted by the Commission and by referring to it as an anomaly, the Commission has granted review in its Order in Case No. 18 of 2013 in the matter of RInfra-D s Schedule of Charges. (ii) BEST has not been allowed to recover charges specific to Service disconnection (permanent removal of service cable) activity which is different from conventional reconnection (supply restoration) activity. BEST had requested separate service disconnection charges in its Petition in Case No. 90 of b. Meter shifting involves shifting of only single meter in the same meter cabin or other meter box where space and service line is available, whereas service shifting involves shifting of entire meter box along with meter and service cable. The process and steps involved in service shifting was explained pictorially with the help of a diagram. MERC Order [Case No. 22 of 2013] Page 7 of 10

8 c. In case of Meter shifting, the cost ranges from Rs.300 to Rs.1000 for single meter whereas in case of Service shifting, the cost ranges from Rs to Rs for meters connected to different size of cables. The rates approved by the Commission are appropriate for meter shifting activity only. While giving cost implications for Shifting of Service cases, BEST submitted that 188, 160, and 116 such cases had occurred during FY , FY , and during FY (till February 2013), with cost totalling to Rs. 1,65,91,450, Rs. 64,79,167, and Rs. 79,92,290, respectively. d. In case BEST follows the Order, the higher expenses incurred in Service shifting for meeting the request of a specific consumer will get transferred to other consumers through the Aggregate Revenue Requirement (ARR). The Commission, in its Order in Case No. 18 of 2013, has stated that any under recovery of cost of service shifting, which is on account of specific consumers will get passed on to pooled revenue requirement. e. As regards service disconnection charges, in addition to the points made in the Review Petition, the process and steps involved in service disconnection was explained pictorially with the help of a diagram. The cost for such activity ranges from Rs to Rs /- per case and this is totally different from a case of reconnection of supply. f. BEST submitted that 151, 124 and 235 numbers of pot headed services occurred during FY , FY , and FY , respectively. For FY , the cost per case ranged from Rs to Rs for different sizes of service cable with expenditure totalling to Rs. 49,23,715. BEST clarified that presently it is not charging consumers for the activity of service disconnection. In case charges on actual basis are not allowed to be charged, the expenses incurred will get transferred to other consumers through the ARR. 7. Having heard the Petitioner and after considering the material placed on record, the Commission is of the view that the Review Petition needs to be tested against the requirements laid down in Regulation 85(a) of the MERC (Conduct of Business) Regulations, 2004, which provide as under:- Review of decisions, directions, and orders: 85. (a) Any person aggrieved by a direction, decision or order of the Commission, from which (i) no appeal has been preferred or (ii) from which no appeal is allowed, may, upon the discovery of new and important matter or evidence which, after the exercise of due diligence, was not within his knowledge or could not be produced by MERC Order [Case No. 22 of 2013] Page 8 of 10

9 him at the time when the direction, decision or order was passed or on account of some mistake or error apparent from the face of the record, or for any other sufficient reasons, may apply for a review of such order, within forty-five (45) days of the date of the direction, decision or order, as the case may be, to the Commission. 8. The Commission is of the view that BEST has made out a case for review, since, if the Commission s Order in Case No. 90 of 2012 is implemented as directed, then there could be unintended consequences, and any under-recovery of the cost of service disconnection as well as cost of Shifting of service connection would effectively be passed on the pooled Revenue Requirement and thereby, passed on to all the consumers, though the cost incidence is on account of a requirement of a particular consumer. 9. As regards service disconnection, it is observed that BEST, in its Petition in Case No. 90 of 2012, had specifically sought the Commission s approval for charging for the activity of removal of service cable on actual cost basis. Now, BEST has submitted the details of number of such cases in the past along with the cost implications. In light of the information submitted, the Commission hereby rules that BEST shall levy the actual cost involved for service disconnection on the request of consumer. 10. As regards Shifting of Service, BEST while justifying the admissibility of the Petition referred to the Commission s ruling in the Order dated 21 March, 2013 in Case No. 18 of 2013, as reproduced below: 5. Moreover, RInfra-D, in its Petition in Case No. 73 of 2012 had specifically asked for approval for shifting of service rather than shifting of meter, and the anomaly has occurred on account of rationalising the charges across the Licensees, though BEST and TPC-D had not asked for approval for charges for shifting of service. Accordingly, the Commission hereby rules that RInfra-D shall levy the actual costs involved for shifting of service at the request of the consumer, and amends Para of the Order in Case No. 73 of 2012 to that extent as under:. (emphasis added) It is pertinent to note that BEST, in its Petition, had not asked for approval for charges to be levied for shifting of services. However, as explained in Paragraph of the Order dated 28 December, 2012 in Case No. 90 of 2012, the Commission has rationalised the activities to be charged across the Licensees, in order to remove the ambiguities. Accordingly, the Commission had clubbed the activity of Shifting of services and Shifting of Meter MERC Order [Case No. 22 of 2013] Page 9 of 10

10 under single head and approved the combined charges for these activities. BEST has now submitted the cost implication of Shifting of Services. In light of the information submitted, the Commission hereby rules that BEST shall levy the actual costs involved for Shifting of Service at the request of the consumer, and amends Paragraph of the Order in Case No. 90 of 2012 to that extent as under: Particulars Existing Proposed Approved Charges Charges by by the (Case No. BEST (Rs.) Commission 26 of 2006) (Rs.) (Rs.) Shifting of Meter, if carried out only on consumer s request 50 - Single Phase Three Phase Shifting of Service, if carried out only on consumer s request At actual At actual At actual Since, the Commission has reviewed the Order; this amendment to the approved Schedule of Charges shall be applicable with effect from 1 January, 2013 and will continue to remain in force till further Orders. Sd/- (Vijay L. Sonavane) Member Sd/- (V.P. Raja) Chairman MERC Order [Case No. 22 of 2013] Page 10 of 10