Decision on power tariff hike by November

The Karnataka Electricity Regulatory Commission (KERC) will announce its decision before November 20 on a power tariff hike sought by the power supply companies in the state.

KERC chairman K P Pandey told Business Standard after hearing objections to the proposed 51 paise increase by the Chamundeswari Electricity Supply Company (CESC) here today that the commission would hear objections in Mangalore and Hubli on October 15 and October 20 respectively with respect to Mescom and Hescom.

“After hearing these objections, KERC will announce its decision before November 20,” he said.

To a query if the KERC would suo motto take the drought and flood situation in the state into consideration, the chairman replied, “Why should we take suo motto consideration? There is a mighty government and they have all the data. Let them file it.”

Around 32 objections filed by consumer organisations, associations, industries and individuals came up for hearing, some of whom present demanded rejection of the CESC application citing drought, floods and recession, apart from power issues in CESC’s jurisdiction of Mysore, Mandya, Chamarajanagar, Hassan and Kodagu districts.

Making a strong case on behalf of the Federation of Karnataka Chambers of Commerce and Industries (FKCCI) and ‘Laghu Udyog Mitra’, advocate Sridhar Prabhu maintained that the KERC had no jurisdiction to hear the CESC application as it was based on the 2005 tariff order which had lapsed following the appellate tribunal’s latest order in 2009. Being a contempt, it was not maintainable.

Instead of raising the tariff, it should refund with retrospective effect the excess charges collected based on the 2003 and 2006 orders. CESC had failed to properly use the subsidy amount too, he argued.

FKCCI energy committee chairman M G Prabhakar said the application was in contrast to the KERC order, particularly the AT order and hence not maintainable. Even if the KERC had passed an order in favour of the power companies, it would be in force for hardly 3-4 months.

While referring to the industrial and agricultural scenario in the state, he maintained that the power companies were surviving on the security deposits of consumers. Power consumption by industry has been falling from 1991. Although the number of irrigation pumpsets had risen to 1.06 million from 960,000 in 2007, food production was not in line with their numbers. The government subsidy was only Rs 1,800 crore, while the shortfall from agriculture was Rs 5,993 crore. “Days will not be far off when the power supply companies will sink,” Prabhakar cautioned.

Mysore industry association general secretary Suresh Kumar Jain said drought and floods had hit industry and agriculture in 25 districts in the State. Industry had suffered because of global recession too. Power supply for 2-4 hours a day had added to their woes in Mysore. CESC was taking an anti-consumer stand instead of collecting arrears like Rs. 316.70 crore from local bodies. As power generation would reach its peak with reservoirs overflowing, power tariff should be reduced.