The Hindu Business Line : Bengal SEB revenue needs slashed 30 pc

THE revenue requirement of the West Bengal State Electricity Board (WBSEB) has been slashed by nearly 30 per cent by the West Bengal Electricity Regulatory Commission (WBERC) in its tariff order for 2004-05.

One of the reasons behind disallowing a portion of the revenue requirement is non-furnishing of full documents, information and data, according to the just-released tariff order.

As against Rs 3,728.8 crore claimed by the electricity board, the regulatory commission has allowed a requirement of only Rs 2,557.25 crore with the average cost of supply being pegged at Rs 2.75 per kilowatt hour (kWh) against Rs 3.57 sought by the WBSEB.

Significant cuts have been imposed in areas such as employee cost, provision for doubtful debt and interest and finance charges.

A lower surplus of Rs 60.2 crore has been admitted by the regulatory commission against Rs 64.7 crore claimed by the electricity board.

The WBERC is particularly peeved about the fact that the WBSEB had remained silent about the reduced interest rate that it has been enjoying on loans received from the West Bengal Government for some time now.

Commenting on this, it said in the order: "It was further noted that the order of the Government of West Bengal was issued on 9.10.2002 ... neither this letter has been filed by the board with the Commission not brought out the same to the notice of Commission at any time ... and the board has continued to justify the high rate of interest even during the hearing ... An extra amount was claimed particularly in the petition for 2003-04."

It noted that the first mention of the interest rate reduction was made in the 2004-05 tariff review petition.

The order said that the total interest chargeable worked out to a vastly lower figure and adjustments have to be made for higher interest allowed by the regulatory commission since 2001-02.

The commission was so irked at the electricity board's failure to give full documents and information that it had at one time moved towards rejecting its petition altogether.

However, since it felt that this would not help the consumers at this stage, the WBERC withheld an amount of Rs 372.98 crore provisionally from the revenue requirement of 2002-03 and 2003-04.

This amount will be released once it is satisfied that the electricity board has started taking "adequate steps in the right direction in this regard", the order said.

It may be mentioned that the WBERC, in its order, had reduced the WBSEB's average tariff allowing a small increase in farm power while leaving most of the electricity rates untouched.