Power Tariff: OERC’s Erroneous Method Costs Consumers 39.35 Paise More Per Unit In Odisha

Bhubaneswar: With the Odisha Electricity Regulatory Commission (OERC) keeping non-tariff income and provisional supply of the power distribution companies, the consumers are paying 39.35 paise more per unit in the state.

According to sources, the OERC has not taken Rs 914.21 crore income of the four Tata Power-owned distribution companies while determining the average cost of power supply for 2022-23. The amount includes non-tariff income of Rs 564.21 crore and provisional surplus of Rs 350 crore.

As per the power tariff decided by the Commission for the the current fiscal, the average cost of supply per unit has been fixed at 587.77 paise, while that for extra-high tension (EHT) is 654.61 paise, high tension (HT) 640.36 paise and low tension (LT) 487.44 paise.

“Had this amount of Rs 914.21 crore been taken into consideration while approving the aggregate revenue requirement and tariff determination, the benefit could have been transferred to the consumers through lower tariff,” TNIE quoted power analyst Ananda Mohapatra as saying.

Since the Commission does not want to keep tariff rate competitive, as evident from its tariff orders, there is no growth in the energy consumption and power intensive industries are sourcing cheaper power from captive generation or outside.

As the Commission is passing higher costs in the proceeding to approve the average revenue realised (ARR) applications and determine tariff for the utilities, the distribution companies are getting the benefits without asking, Mohapatra said. For example, the four discoms had proposed Rs 9,291 crore towards power purchase cost but the Commission approved Rs 10,045 crore for 2022-23.

It may be noted that the erroneous methods of OERC to determine the power tariff cost the industrial consumers an additional Rs 1,090 crore in 2020-21 and about Rs 1,200 crore in 2021-22. The discoms have been billing higher tariff to the EHT and high tension HT consumers than what is approved by OERC in the past few years.