Home ECONOMY Steep hike in power tariff likely in Odisha

Steep hike in power tariff likely in Odisha

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Odisha Sun Times Bureau
Bhubaneswar, Jan 4:

Electricity consumers in Odisha may be in for a jolt in the New Year with a possible steep hike in power tariffs.

powerThe per unit cost can go up as high as Rs 5 to 6 per unit. More worryingly for consumers, the new tariff could come into force with retrospective effect from 2006-07.

With the state government maintaining a discreet silence over the Appellate Tribunal for Electricity (ATE) orders asking the Odisha Electricity Regulatory Commission (OERC) to compensate losses sustained by power distribution companies (discoms), increase in power tariff in the state seems inevitable with a burden of about Rs 4,200 crore set to be passed on to consumers.

The ATE, in its verdict, has expressed its unhappiness with the failure of OERC to implement its earlier order and asked it to compensate discoms, managed by Reliance Energy, by revising power tariff in the state from as early as 2006-07 retrospectively. The ATE’s verdict has put the OERC in a difficult situation. It is not yet clear whether the OERC will accept the ATE’s verdict or would challenge it in the court.

On its part, the OERC cited its pending appeal in the Supreme Court to explain away its failure to implement the order.

“The OERC has to conduct a fresh hearing and take a call on the issue,” former OERC chairperson DK Ray said.

The state government’s refusal to take a decision and leave it to the OERC to take a call is being seen as an indirect way of asking it to accept the arguments of Reliance Energy.

If the state government or the OERC fail to get a stay order on the ATE orders from the Supreme C ourt, a financial burden would be passed on to around 50 lakh consumers in the state.

Energy minister Pranab Prakash Das was non-committal on the issue saying; “It all depends on the OERC. Thegovernment has nothing to do with it.”

Reliance Energy managed discoms Nesco, Southco and Wesco in the state had moved ATE against the verdict of the OERC. The discoms had mainly appealed to the ATE to hike power tariff.

According to available reports, the OERC has been reducing tariff by setting a target to reduce distribution losses by 21 percent. The discoms, on the other hand, have been arguing that reducing distribution losses by even three percent per annum is a difficult task. During the hearing at the OERC, the discoms also argued that they were sustaining huge losses as a consequence of it.

In order to reduce distribution losses, discoms need to develop and make improvements in their infrastructure. But these companies are showing no interest in making any investments on this front. The CAPEX programme of the state government has also lost its direction, opine experts on conditions of anonymity.

Moreover, discoms are self assessing their losses, which is being accepted by the OERC without question. Consumer bodies have been demanding third party audits. However, no steps have been taken on this account by the government, rued experts.