After much sound and fury, Arvind Kejriwal does U-turn on power

Written by Geeta Gupta | Geeta Gupta | New Delhi | Updated: Jan 13 2014, 19:41pm hrs
Arvind KeijriwalDelhi CM Arvind Kejriwal has alleged that power distribution companies are not sharing the reduction in their Aggregate Technical and Commercial (AT&C) losses with the consumers.
After announcing on Friday a 10-month waiver and no action against power bill defaulters and pilferers who were part of the (bijli-paani) andolan last year, Chief Minister Arvind Kejriwal on Saturday did a U-turn, saying his government was yet to take a final decision in this regard.

Arvind Kejriwal has also alleged that power distribution companies were not sharing the reduction in their Aggregate Technical and Commercial (AT&C) losses with the consumers. In response, the discoms have now countered the allegations in a letter to the Delhi government, claiming a deficit of Rs 8,000 crore. The communication comes barely a week after the government announced a CAG audit of the power discoms from the time they were privatised in Delhi.

Presenting their financial position, the discoms claimed that the 300 per cent increase in power purchase costs over the last 10 years have fully negated the benefits of loss reduction and in turn created a deficit of over

Rs 8,000 crore.

It is unfortunate that instead of recognising the substantial contribution of BSES discoms in reducing AT&C losses, supplying 24X7 quality supply and providing world-class consumer services, misleading and baseless allegations are being made, and the real issues leading to increase in power tariffs are not being addressed, states a letter to Delhis Power Secretary Puneet Goel, sent by BRPL CEO Gopal Saxena and BYPL CEO Arvind Gujral on Friday.

The BSES has clarified: After privatisation in July 2002, AT&C losses have been reduced by BSES discoms from 57 per cent (2004) to 18 per cent (2013), and the same have been reported to DERC.

The reduction in AT&C losses of the BSES resulted in additional revenues of Rs 19,258 crore over the last 10 years. On the other hand, however, the bulk power purchase costs of the BSES discoms from central PSUs such as NTPC, NHPC, PGCIL, and state undertakings such as IPGCL and DTL have increased by almost 300 per cent. The letter states that the average cost has increased from Rs 1.42 per unit in 2004 to Rs 5.54 per unit in 2013.

This has led to net increase in power purchase costs of Rs 27,404 crore in the same period of 10 years, the letter states.

Before even a CAG audit has been conducted on the books of the discoms, the BSES has also annexured details of gains on account of AT&C loss reduction, and increase in power purchase cost over the last 10 years.

As per the books, the gains from AT&C loss reduction were Rs 19,258 crore, while the additional cost of bulk power, which constitutes up to nearly 85 per cent of the cost component of total tariff was Rs 27,404 crore, leaving behind a deficit of Rs 8,146 crore, before operating expenses.