Apex court notice on BSES plea for higher tariff, dues

The Supreme Court Friday served notice on a plea by BSES, which supplies power to the bulk of consumers in the capital, on implementing a tribunal order to be allowed to hike power tariff and recover past outstanding dues.

The notice was served on the central government, and the apex court bench of Justice B.S. Chauhan and Justice A.K. Sikri fixed July 3 as the date of next hearing. That is when the regulator's plea for a stay on a November judgment by the tribunal is listed for hearing.

BSES also sought the vacation of an apex court order Feb 28 last year, by which it allowed the appellate tribunal to pronounce its judgment on BSES plea to hike the power tariff in the capital and payment of dues, but restrained the same from being enforced.

The BSES petition said that it was unable to pay the outstanding dues to the state-run power generating and transmission companies, including NTPC, as the regulator was not allowing the tariffs to be revised so as to reflect the costs.

It was this absence of cost-reflective tariff that its loss on account of selling power in the capital below cost kept rising, BSES said while blaming the watchdog, the Delhi Electric Regulatory Regulatory Commission, of artificially depressing the tariff and the revenue stream.

The petition said that the current adverse financial position and the cash flow crisis faced by power distribution companies in the capital were on account of wrong assumption of surplus revenues projected due to tariff orders that, year after year, actually caused more deficit.

This flaw alone resulted in an accumulated revenue gap of Rs.6,300 crore in the past four years ending 2011-12, the BSES plea said. For 2012-13, the gap was around Rs.1,300 crore for BSES Rajdhani and Rs.1,170 crore for BSES Yamuna - its actual two power suppliers.

Seeking the implementation of the tribunal award, BSES said if it was not allowed higher tariff and a clearance of past dues, it would then not be able to comply with May 6 order of the apex court that it should clear the dues to NTPC and others by May 31.

That order had directed the distribution companies to pay current duties to NTPC by May 31, failing which, it said, an earlier order would stand vacated. That order restrained the state-run power generator from discontinuing power.

For the record, the Appellate Tribunal in an order last November wanted the regulator to take immediate steps and put in place a schedule to recover the revenue gap and allow the distribution firms to recover their costs to prevent a cash-flow problem.