Andhra slashes industrial power tariffs

In line with the state government's ongoing efforts to lower industrial tariffs, the Andhra Pradesh Electricity Regulatory Commission (Aperc) today announced a marginal reduction in power tariff for all HT (high tension) category consumers, including railway traction for the year 2006-07.

This reduction is not expected to have an impact on the revenues of the four state-owned distribution companies (Discoms) from the industrial sector on account of increase in industrial sales as projected by them.

The commission on Thursday issued retail supply tariff order for the next financial year for all categories of consumers in the state besides determining transmission charges for the next three-year period. Domestic tariff rates and tariff for all other LT (low tension) categories including lift irrigation and street lighting remained unchanged.

Under the HT category 1(A) or industry general category, the commission has reduced the charges significantly from Rs 3.25 per unit to Rs 2.80 per unit to those industries drawing power at 132 kv level. But the reduction of charges under the same category at 33 kv level is about 20 paise per unit and at 11 kv level only about 10 paise per unit.

For ferro alloys units or HT category 1(B), the per unit charges have come down to Rs 2.55 from Rs 2.87. Similarly, the commission has also offered a considerable relief to commercial establishments under HT category 2 or non-industrial category for those drawing power at 132 kv level.

Energy charges under this category at 132 kv level have been reduced to Rs 3.65 per unit from the existing Rs 4.40 per unit across the board. For consumers at 33 kv level, the reduction is 50 paise per unit. But at 11 kv level there has been no change. Tariff for railway traction (HT-5) has been reduced by 20 paise a unit to Rs 4.20 from the existing Rs 4.40 rate.

In addition to relief offered on energy charges, the load factor incentive structure for the HT category 1(A) has also been modified by the commission to promote shift to higher load factors which, according to Aperc, is desirable for system demand management. But the monthly demand charges for each kVA under the same category at 132 kV and 33 kV levels have been enhanced to Rs 250 and Rs 230 respectively from the existing Rs 195.

Of the total revenues of Rs 9,841 crore projected by the four Discoms for the year 2006-07, revenues from industrial sales have been pegged at Rs 3,553 crore, according to Surya Prakash Rao, secretary, Aperc. The power utilities have projected a 7 per cent increase in revenues for the year 2006-07.

Among other things, the commission has reduced the revenue gap of Rs 1,576 crore as was originally projected by Discoms in ARR (aggregate revenue requirement) submissions, to Rs 1,351 crore, the amount the state government has offered to provide in the form of power subsidy.

The Aperc secretary also said that in spite of the reduction in industrial tariffs, the overall cross subsidisation component built into tariff structure was estimated to have slightly gone up to Rs 3,400 crore.