Reeling under huge losses, distribution companies in Delhi are looking for another rise of about 20 per cent in power rates in less than a year.
There was a 21 per cent rise in rates in September last year, but despite the increase, discoms, BSES and North Delhi Power Ltd (NDPL), have accumulated losses of about Rs 11,000 crore in the last three years.
Reliance group companies BSES Yamuna Power Ltd and BSES Rajdhani Power Ltd account for around 70 per cent of the power distribution in Delhi city.
Private discoms were asking for a 50 per cent increase in rates due to increase in power purchase cost, among other factors. The September hike came after rates were last revised in 2009.
“We are expecting a hike of 19-21 per cent in power rates in the next few months. We have asked DERC (Delhi Electricity Regulatory Commission) to look at all factors of cost. The tariffs have to be cost-reflective rise so that discoms stop bleeding,” BSES Rajdhani chief executive officer Gopal Saxena told Business Standard.
He said the actual hike, which happened in September last year came out to be only six to eight per cent, as a majority of it went towards mitigating the cost for generation companies. Discoms have also asked for implementation of overall power purchase adjustment formula on a monthly basis in the rate petition for 2012-13.
Discoms have been able to show profits because of regulatory assets, which are unrecovered costs and proposed to be recovered through future rate revisions.
Delhi’s power demand has reached a peak high of 5,178 megawatts (Mw) on June 1, from 4,994 Mw on June 24 last year.
The accumulated losses of discoms across India are estimated to be over Rs 2 trillion at the end of 2011-12, from Rs 1.23 trillion at the end of the previous year, according to a CRISIL report. Apart from the losses, the amount of outstanding loans for the utilities, including short-and long-term ones, stood at Rs 1,77,602 crore as of March 31, 2010.