Private Power Firms Want Tariff Hike in Delhi
By Rahul Chhabra
Times News Network
May 15, 2003

NEW DELHI: Private power distribution companies have sought a hike of 12 to 30 per cent in tariff to make up the Rs 2,579 crore loss they incurred this financial year. A final decision on the hike will be taken by the Delhi Electricity Regulatory Commission soon.

A number of residents who attended the DERC hearing for power tariff revision protested against a hike in the immediate future. "Any hike at this juncture will be unjustified. It will burden the common man," said R N Gujral, who represented the Federation of Rohini Co-operative Group Housing Societies at the hearing.

"Why should the public have to pay to make up for the losses incurred by private companies?" Gujral asked.

The process of hearing public objections on the hike demanded by BSES and Tata Power was completed by the Commission on Wednesday. The Commission will now analyse the requirements of private companies and finalise the new tariffs.

The Delhi government-run transmission company officials present on Wednesday's hearing said a hike of 12 per cent in electricity rates was justified. Anything beyond that would burden the consumers.

Power tariffs were last revised in June 2001 when power distribution was controlled by the erstwhile Delhi Vidyut Board. The DERC had then approved a hike of 15 per cent.

A representative of a workers' organisation, Rajan Gupta, boycotted the hearing proceedings in protest. "The process of inviting public objections is just an eyewash. The private companies have already got an assurance from influential authorities on a hike," he alleged.

Distribution of power was privatised nine months ago and the total revenue gap - money spent minus money collected - during this period has touched Rs 1,800 crore. During DVB's tenure, the annual revenue gap was Rs 900 crore.

During the last nine months, BSES Rajdhani has lost Rs 104 crore, BSES Yamuna Rs 84 crore and NDPL Rs 132 crore. Delhi government-owned Transco has lost Rs 1,501 crore providing power at a subsidised rate to the private companies.

At the time of privatisation, the Delhi government had foreseen losses for the private companies and had set aside Rs 3,450 crore to compensate them over a period of five years.

Even if the entire subsidy amount is paid to the two companies, they would still stand to lose Rs 1,000 crore over the last two years. "The recent proposal to hike tariff is aimed at making up for this revenue gap," said a former DVB official.

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