Why surcharge on power purchase increased, asks HC

Last Updated: Thu, Feb 20, 2014 16:30 hrs

New Delhi, Feb 20 (IANS) The Delhi High Court Thursday asked Delhi Electricity Regulatory Commission (DERC) to inform it about the reason for a six-eight percent increase surcharge on power purchase costs by electricity distribution companies.

A division bench of Acting Chief Justice B.D. Ahmed and Justice Sidharth Mridul asked the DERC to apprise it on what basis and formula it increased the surcharge on power purchase.

"File an affidavit indicating the basis and formula of increasing the surcharge within three weeks," the bench asked the regulator while posting the matter for March 13.

The DERC had hiked the power surcharge in Delhi and the rates had gone up from six to eight percent depending on which distribution companies delivers power, thus effectively taking up power tariffs.

The court was hearing a PIL filed by Aam Aadmi Party founding member Madhuresh Lakhaiyar seeking direction to the three discoms in the capital to not increase power tariffs.

The public interest litigation (PIL) filed by Lakhaiyar sought the court's direction to ascertain the reason for increasing the power tariff as per the recent hike in power purchase cost adjustment changes (PPAC) by calling records of the DERC.

The PIL said the move could have been avoided as the Comptroller and Auditor General (CAG) was already looking into the accounts of the discoms.

On Jan 31 last year, the DERC had approved a quarterly PPAC sought by the three power distribution companies for the October-December quarter.

The plea said the three discoms - BSES Rajdhani, BSES Yamuna and Tata Power - in the past few years, in nexus with the DERC, steadily increased the PPAC and other charges, with the resulting increase in the tariff to be paid by consumers.

"In view of the audit being conducted of the accounts of the three discoms by the CAG, due to serious allegations regarding their functioning and accounting, the state commission ought to have waited till the report of the CAG," the petition said.

The PIL said the discoms have claimed that since the power purchase cost has increased, they have to increase the PPAC component.

"The increase in PPAC has been sought only with a view to neutralise the incentive offered by the Delhi government of upto 50 percent rebate for use upto 400 units of electricity," the PIL said.

"The NTPC has threatened to discontinue providing electricity unless Rs.180 crore is paid by the discoms, whereas the truth is that there are other states where the outstanding dues run into thousands of crores but no threat of discontinuation is made."

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